A construction loan is a type of finance specifically designed for people building a new home or undertaking major renovations. Unlike a traditional home loan, where funds are provided in a single lump sum at settlement, construction loans are generally released in stages as the build progresses. These stages are often referred to as progress payments. This structure helps ensure funds are available when needed throughout the construction process.

While every project is different, the process generally includes: Purchasing Land If you haven't already secured your land, finance may be arranged for both the land purchase and construction costs. Obtaining Building Contracts Lenders will typically require a fixed-price building contract and approved plans before construction finance is finalised. Progress Payments Funds are released to the builder at various stages of construction, such as slab, frame, lock-up and completion. Moving Into Your New Home Once construction is complete, the loan generally converts to a standard home loan arrangement.

Construction finance can involve additional paperwork, lender requirements and timelines that many borrowers haven't encountered before. Having someone guide you through the process can help you: Understand your borrowing capacity Navigate lender requirements Structure your finance correctly Avoid unnecessary delays Stay informed throughout the build Most importantly, you'll have someone in your corner helping you understand what comes next.