Construction Loans

Here are few points to consider when preparing for your construction loan…

Unconditional approval – you will need signed licensed building contract, plans and specs or a tender agreement to get an unconditional approval.

Valuation – is needed for unconditional approval and is based on both the land and the building upon completion. So, it is important to be aware the construction costs can be more than the end valuation of the building. So, a buffer of funds in place is a prudent strategy should valuations fall short.

Loan Offer – is usually valid for 6 months.

House and land package – You may wish to apply for 2 separate loans at the same time. This stops the issue of having one loan with 2 separate settlement dates.

Schedule Of Payments – Progress payments are made at specified stages of the build, usually 5 or 6 stages depending on the lender and project.

Interest – is only payable once funds are drawn and all loans are interest only during the build.
Please let us know when you would like to sit down and discuss your project, it is an exciting time and we are here to help you