Construction

Construction
Home Loans

Construction

Ready to build your Dream Home? Apply for a Construction Loan today

Whether you’re looking to finance the building of a new home or need some funds to do some major renovations, then look no further. Our mortgage brokers can help you apply for a construction loan at the lowest rates available to someone in your situation, from our panel of top lenders in Australia.

Choose from a variety of construction loan options

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Our expert team will assess all your needs and provide you with the best financing option.

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We value your time. Get an initial assessment in under 48 hours.

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We have partnered with over 30 leading lenders to bring you a variety of construction loan options.

Frequently Asked Questions about Construction Home Loans

What is a Construction Home Loan?

Unlike a regular Home Loan, Construction Home Loans let you borrow from the bank to build a home, instead of buying one.

The biggest difference between this type of loan, and a regular home loan is that you will receive your loan amounts based on the construction schedule, i.e. based on the costs of construction. The property value is also estimated based on the completed property which is used to calculate your LVR.

Furthermore, you may also need to include the cost of the land into your loan (unless you already own an empty piece of land).

Lastly, Construction Loans are deemed more risky by lenders, so you will need to have a good credit history in order to increase your chances of getting approved.

How are the payments released in a Construction Home Loan?

As mentioned earlier, lenders will release various amounts of your loan based on the construction schedule, or the stage the construction is at.

  1. Slab – This is when the foundation, plumbing, and others are being laid, and is around 10% of the property value.
  2. Frame – The second amount is released when it is time to build the frame of the house, and is used to pay for brickwork, roofing, windows, and more. This amount can be around 15% of the property value.
  3. Lock up – This is when your builders are ready to build walls, doors, and windows that actually let you lock up your house.
  4. Fixing – This amount covers all your internal fixtures including tiles, cabinets, shelves, gutters, plumbing, electrical lines, and more.
  5. Completion – This final payment is used to cover all pending payments, as well as any final work on the property such as fences, painting, cleaning, and others.

The benefit of lenders making these types of progress payments is that you are only paying interest on the amount released, and not the total loan amount. However once the property is completed, the loan will be reverted into a standard mortgage with principal and interest repayments.

Are there any incentives for anyone building their first home?

Yes, there is a government scheme called the Homebuilder Grant that grants you $25,000 for building your first home.

For more information about this grant, and to see if you meet the eligibility criteria, you can contact your local State Revenue Office, or speak to your mortgage broker.

Is the loan application process the same for Construction Loans?

Since you are building a new property, you will need to provide additional documents related to the construction project such as council plans, building permits, building contract, and more, in addition to the other documents required for a home loan such as financial history, bank statements, proof of income, proof of assets, proof of employment, and more.

Can I get a Construction Loan to renovate my property?

Yes, you can still apply for a construction loan if you are planning any major renovations on your existing property.

Can I get a Construction Loan for other types of property?

Yes, you can also apply for a construction loan to build an investment property, i.e. a property you will rent out and not live in.

How much will I be able to borrow?

Your loan amount will depend on a variety of factors, including your income, current holdings, credit score, and more.

Quickly find out the estimated amount you could borrow based on your current earnings and expenses.

Can I get a more detailed assessment?

Get a no-obligation, personalized assessment from one of our expert mortgage brokers at ZERO COST.

Home Loan Calculators

You can also use our industry standard calculators to understand your situations better.

Borrowing Power Calculator

Quickly find out the estimated amount you could borrow based on your current earnings and expenses.

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Home Loan Offset Calculator

An offset account, as the name suggests, offsets the amount of loan you have taken from the lender.

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Loan Repayments Calculator

Find out the estimated amount of repayments (EMI) you will need to pay on a monthly, fortnightly or quarterly basis for paying your potential home loan.

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