Build your home with finance that moves with the build.
Construction finance works differently from a standard home loan. Instead of receiving the entire loan amount upfront, funds are released progressively as construction reaches agreed milestones. That means your loan needs to be structured around your land purchase, building contract, construction schedule and expected costs.
How progress payments work
Construction typically moves through a series of stages. During construction, interest is generally charged only on the amount that has been drawn.
Slab
Site preparation and foundation work are completed.
Frame
The structural frame is erected.
Lock-up
External walls, roofing, doors and windows are installed.
Fixing
Internal plumbing, electrical, plastering and other internal works progress.
Practical completion
Finishing work is completed and the property is prepared for handover.
Final drawdown
The remaining approved funds are released following completion requirements.
Land + construction finance
A construction loan can combine the finance required to purchase vacant land with the funding needed to build your new home. Rather than receiving the entire construction amount at the beginning, the lender releases funds through staged progress payments.
What can you build?
Each project has different lender requirements, so the construction type and builder can affect which lenders are available.
Construction finance may be suitable for:
- Custom-built homes
- House-and-land packages
- Knockdown and rebuild projects
- Duplexes and dual-occupancy projects
- Selected owner-builder projects
- New investment properties
Why construction finance can work differently
Pay interest on what's drawn
Because funds are released progressively, you generally pay interest on the amount actually used during construction.
Plan around your building contract
Your loan needs to reflect the approved construction cost and agreed progress payment schedule.
Greater control over your home
Building allows you to select the design, layout, finishes and specifications around your needs.
Potential government support
Eligible first-home buyers may qualify for government schemes or grants when building a new home, subject to current rules and state or territory eligibility.
How much deposit do you need?
Many lenders require around 10–20% of the combined land and construction cost, although eligible borrowers may have access to lower-deposit options through government schemes or other lending arrangements. Your required contribution depends on the lender, project, property value and your individual financial position.
From block of land to completed home
We can help coordinate the finance strategy across the entire journey: Borrowing assessment → Land purchase → Construction approval → Progress payments → Build completion → Final loan structure. We'll compare lenders, assess the project and help ensure your finance is structured around the construction timeline.
Construction comes with risks.
Cost variations
Changes or upgrades can increase the final cost.
Construction delays
Delays can affect your timeline and financial commitments.
Builder risk
Builder insolvency or contractual issues can create significant complications.
Valuation risk
If the completed property is valued below expectations, additional funds may be required.
Repayment changes
Once construction is completed, your repayments may increase as the loan moves into its normal repayment structure.
Lender requirements
Not every lender accepts every builder, project type or construction arrangement.
Ready to build?
Let's work through your land, construction costs and borrowing position before you commit to the build.
Book a free, no-obligation construction loan consultation.Got Questions?
Frequently Asked Questions
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