Unlike a standard home loan, construction loans are drawn-down (there is a repayment schedule to make construction progress payments.)
Basically, you are asking your lender to pay your builder for the part of the construction work that is completed. Usually, five payments have to be made at each stage of construction.
Before the lender allows you to begin construction, you and your builder will need to provide them with the following documents:
- Signed building contract.
- Council approved plans.
- Construction certificate (NSW) or Building permit (VIC) or Decision notice (QLD).
- Builders Insurance (certificate of currency).
- Builders Indemnity / Public Risk Insurance ($5 million minimum for most lenders).
We specialise in construction loans.
Give us a call on 1300 889 743 or fill in our free assessment form to find out if you qualify.
Cheers,