Latest in Construction Loans
Construction Loans - August 6th
How much does an architect cost?
Undertaking a renovation, new home or unit development can require a lot of logistics and project management. Setting a budget, arriving at a suitable design, navigating the relevant planning and building regulations, selecting materials, hiring the...– Read more
Construction Loans - June 8th
Building your home? Here’s how a construction loan works
What is a construction home loan? A construction home loan is a type of home loan designed for people who are building a home or doing major renovations, as opposed to buying an established property. It...– 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.
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