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Construction Loans
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intellichoice
Does a Construction Loan Fit My Needs?
Are you building a new home or making major renovations to your existing home? If you plan to sign a building contract with a licenced builder, you can get a construction loan (also known as a building loan).
A construction loan provides a safety net for your finances while building takes place—you are guaranteed that your home is being completed on the same timeline as the disbursement of your loan.
Construction Loans Versus Home Loans
A construction loan is a type of home loan in which you don’t borrow the entire lump sum at the start of the project. Instead, the total loan amount is divided into payments, called progress draws, that are released throughout the construction stages.These loans offer financial flexibility because you only pay interest on the loan as it’s released. In fact, most lenders only expect you to pay the loan interest throughout construction. When the project is complete and the progress draws are fully drawn down, the loan usually reverts to a standard home loan, in which you pay principal + interest until the loan is fully repaid.
Is a construction loan right for you?
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intellichoice
How Can I Get a Construction Loan?
There are a few steps when you apply for a construction loan, and our team simplifies the process. Starting with one of the most important steps, get an estimated market value of your finished project. This determines the amount you qualify to borrow, and it protects you from falling short of funds to complete the project, as well as reduces the risk of loan default for the lender.
Next, choose a registered builder who will help you complete the council plans and get permits, and you’ll also get insurance. These documents are part of your loan application.
Rather than pulling all these pieces together on your own, and then applying for loans across several providers, our team manages the process on your behalf. We’ve successfully taken hundreds of clients through this process, and we streamline the process while being your advocate for the best loan package.
Curious about lending possibilities?
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What Are the Phases of a Construction Loan?
Once your loan is secured, the lender is involved throughout construction: checking quotes, reviewing plans and contracts and ensuring documents meet the industry standards.
The lender also monitors the construction process and only makes progress payments when the builder reaches specific objectives and meets satisfactory standards.
Throughout the stages, you provide invoices to the lender so that payments are released to the builder. The construction stages are usually set up as:
- Foundations/footings
- Framing and Roof
- Lock up
- Fitout
- Practical completion
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WE ARE TRUSTWORTHY
Why Partner with Intellichoice?
New construction and renovations are both exciting and stressful: there are many factors to consider before you even choose your first paint colour! To reduce some of the time and strain it takes to manage the financial side of the project, let us put our expertise to work for you.
- Spend your time choosing fixtures, not finding lenders. We’ll save you time up-front by putting together a comprehensive application that meets lender requirements.
- Get the best rates. With access to more than 50 lenders, we source the best loan package for your specific construction needs.
- Simplify the process. We guide you through the paperwork and create a straightforward experience.
- Work with a responsive team. We partner with you from start to finish and stay in touch every step of the way.
Interested in getting a loan?