Planning to loan for building a new home or renovating an existing one?

"Australians purchased 5.3% more new homes in February than the month before, according to the Housing Industry Association (HIA).

Despite market fluctuations, banks continue to demonstrate a willingness to extend loans to Australians pursuing new home construction or renovation projects. For such endeavors, securing a construction loan, as opposed to a conventional home loan, is paramount. Here’s a breakdown of how construction loans operate:

• Application Process: Initiate the loan process by furnishing the lender with essential documents including your building contract, architectural plans, and necessary council approvals.

• Disbursement Structure: Funds are disbursed in staggered stages, typically five, throughout the duration of the project rather than in a single lump sum at the project’s onset.

• Interest Payments: With construction loans, you only accrue interest on the portion of funds received, rather than on the total loan amount.

• Loan Term and Transition: Construction loans usually span between 12 to 24 months. Upon completion, they may transition into a standard home loan structure.

For further information regarding construction loans, do not hesitate to reach out. We are here to facilitate your financing needs.