Constrcution Loans
Building a home isn't easy - our guide outlines what you need to know about financing it
A construction mortgage, also known as a home build mortgage, is designed to finance the costs of building a home.
The borrower and bank agree on the total construction costs and the money is advanced in stages to the builders and suppliers as it gets built. Most often, the interest rate is floating while the home is under construction. Once completed, the loan switches to a fixed rate.
Construction and Home Build Mortgage Summary
Most banks will lend up to 90% of the total construction price. This means you'll need at least a 10% deposit, as well as a contingency fund (given the increasing cost of materials etc.)