Construction Loans Eatons Hill

A standard construction loan suits clients building a home on land they already own, with the funds released progressively as each stage finishes, meaning the interest accrues only on money drawn, so repayments start small and grow alongside the build.

House and land packages, popular with first home buyers, combine a land purchase with a building contract, and lenders split settlements, one for the block and one for the build, changing deposit timing, stamp duty treatment and your borrowing assessment.

Knockdown rebuild projects carry a wrinkle most borrowers miss: while the old house stands, lenders value the land alone, so your usable equity drops until the new dwelling is far enough along for the completed value to be properly recognised.

Vacant land then build is the two-contract path, buying the block first and finding a builder later on, and we structure the land loan so it converts cleanly to construction finance rather than leaving you refinancing awkwardly down the track.

Owner builder finance is the hardest variant to place, because most lenders decline anyone managing their own build, and the few who say yes want insurance, a project plan and costings, so we find a willing lender before lodging anything.

Renovation finance for council-approved work gets assessed like construction, with a fixed contract, staged payments and a valuation of the finished product, so structuring it from day one avoids the mess of a lump sum borrowed against the wrong security.

During construction most lenders accept interest-only repayments on drawn funds only, so if the loan is four hundred thousand dollars fully drawn but the slab is what exists, you pay interest on the slab alone until the next payment clears.

Borrowers who rent while building carry both commitments at once, and with a median household mortgage repayment in this suburb around $2,151 a month plus rent elsewhere, we model the overlap explicitly so the middle months can never surprise you.

A contingency buffer of roughly ten per cent of the contract price covers variations, site surprises and provisional sums that blow out, and lenders increasingly ask where that buffer sits before approving anything, so we build it into the structure.

Extended timelines cost real money, because a build that slips six months adds six more months of interest, possibly two more of rent, and often a fixed-price contract expiry that lets the builder reprice, which is why realistic scheduling matters.

You deal with Your Mortgage Broker Eatons Hill, a credit representative, the same person from first call to final payment, and when you ring for a progress payment update you always speak directly to the one person who personally knows your whole file.

Construction policy varies enormously between lenders, so we test your project against a panel of lenders rather than one bank, finding the one whose drawdown rules, valuation approach and builder requirements match instead of forcing every build through one template.

Most construction clients pay us nothing directly, since lenders pay commission on settled loans and disclose that arrangement in the credit guide before anything is signed, and if your project carries any fee you will hear it from us first.

We publish how construction lending works, from drawdown percentages to approval timelines to the risks that stall builds, because a borrower who understands the mechanism makes better decisions than one sold a product and left to discover the process later.