What if I change my budget after the appraisal is done but before closing?

First and foremost you want to inform your lender that you have made a change.  The budget is the lenders blueprint and payout schedule/template during the construction phase.  Not only is the loan paid out as a whole, but also as individual line items i.e. lumber, electrical, and cabinets etc. Changes, even small changes, to the budget may leave you will less funds set aside for certain items.

If the change in the budget was also a change in the scope of the project, the lender may be looking for your home to be completed in a way that may be different than the changes that you made and impact the overall value. That could be a big issue at the end of the project.

It’s best to inform your lender any time there has been a change made to the budget so the appropriate steps can be taken prior to the closing of the loan.