Construction Finance

How Construction Finance Works

Construct with Confidence

1. Application: Similar to a standard loan application, you’ll need to provide detailed information about your project, including plans, a fixed-price building contract, and details of the builder. The financier will assess your application, which includes evaluating your ability to service the finance and the project itself including the builder.
2. Valuation: Before approval, the financier will conduct a valuation based on the details of the proposed construction to ensure the project’s end value justifies the finance amount.
3. Loan Drawdown in Stages: Instead of receiving the full loan amount upfront, the funds are typically drawn down in stages as the construction progresses. These stages might include slab down (or base), frame, lock-up, fit-out, and completion. The builder will request payment for each stage, which the homeowner then approves and forwards to the us for payment from the construction finance.
4. Inspections: Before the release of funds for each stage, the financier may require an inspection to ensure the work is completed satisfactorily and matches the progress payments.
5. Final Payment and Transition to a Standard Loan: Once construction is completed and all stages are funded, the finance typically transitions to one of our standard home finance products.