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Latest in Construction Loans
Construction Loans - August 7th
Lowest Construction Home Loan Comparison Rates in 2017
If you plan on building your next home instead of buying an existing one, then a regular home loan won’t cut it. You’ll need a construction home loan. Canstar walks you through how to find the lowest rate construction loan available.– Read more
Construction Loans - June 13th
Financing a Renovation - Loan, credit card or overdraft?
Real estate agents sometimes refer to properties that need a lot of structural work as a “renovator's dream”. Realistically, finding the most convenient way to pay for any renovations is probably the real 'dream' for home…– Read more
Construction Loans - May 29th
Construction Loans: 5 Things To Be Aware Of
For most people, building a brand-new home from scratch means applying for a construction loan. Here are 5 construction loan features to be aware of: 1. Fixed construction periods Most lenders will place restrictions on the…– Read more
What is a Construction Loan?
A construction loan is specific loan that caters for property owners wishing to build or renovate on land they already own. Construction loans are progress based. So, rather than receiving the full loan at once (like with usual home loans), you’ll receive it in steps throughout the stages of construction.
These progress steps are called progress draws. You will only pay interest on the amount you have currently drawn. So, if you have only drawn $200,000 out of a $350,000 loan you will only pay interest on the $200,000. Once your house is complete and all the steps of the draws complete, you will begin paying full principal and interest payments. This saves you money while you build.