Want to build in the South West? A construction home loan may be for you!
What’s a construction loan?
Construction loans are designed for people who want to build their own homes instead of buying an established home. They are structured differently than traditional loans and make it easy for you to pay your rent and your mortgage while your new home is built. With a construction loan you’ll make progress payments to your builder at different key phases of the building process. Once your home is built your loan will revert to standard principal and interest payments.
Who’s eligible for a construction loan?
The eligibility requirements for a construction loan are different from a standard home loan. Whilst you’ll need to meet normal lending criteria, such as being able to show you can make repayments, you’ll also need to provide your lender with a building contract for your new home as well as documentation for council plans and permits and any relevant insurances. At Ventura South West our team of in-house finance experts can walk you through all the application requirements and guide you through the entire process.
Ready to get started?
We’re here to help! Get in touch with us today to find out if you qualify for a construction loan and start building in the South West!
Find the answers to some of the most common questions asked by first home buyers, or get in touch with our expert team to learn more!
How do lenders charge interest on construction loans?
With a construction loan you only need to pay interest on the amount of credit that has been drawn at different stages of construction. For example if you’ve been approved for $400,000 but so far you’ve only used $100,000, you’ll only have to pay interest for that $100,000. Throughout construction you’ll only need to pay interest, once your home is built your loan will revert to a standard principal and interest loan.
What documents will you need to apply for a construction loan?
In addition to meeting normal lending requirements around income and expenses, you’ll also need to provide your lender with some other documentation. You’ll usually need to provide a building contract, building plan, quotations from your builder and local council permits and approvals.