Application & Approval:
Similar to a traditional mortgage, you’ll need to submit a loan application and meet specific eligibility requirements. Be prepared to provide detailed plans and budgets for your project.
What is a Construction Loan?
A construction loan is a type of short-term, specialised loan used to finance the construction of a new home or major renovations on an existing property. Unlike a traditional home loan, which provides the full loan amount upfront, a construction loan is paid out in stages, according to the progress of the building project.
This staged approach ensures that funds are released as needed — reducing interest costs and offering better control over your project budget.
Loan Approval & Building Documentation
Before applying, you’ll need a fixed-price building contract, council-approved plans, and a licensed builder. Your lender will review your financial position, property plans, and builder details before approving the construction loan.
Loan Finalisation
Once construction is complete, your construction loan will convert to a standard home loan — with either a fixed or variable interest rate. You’ll then begin making regular repayments on the total loan amount.
At Rising Finance Solutions, we help you navigate every step, ensuring your construction finance is smooth, affordable, and stress-free.
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A construction loan can help you finance this exciting journey, whether you're building from scratch or undertaking significant renovations.
How Does it Work?
Progress Draws:
The loan is divided into stages tied to specific construction milestones. These typically include foundation, framing, lock-up (windows and doors installed), second fix (interior finishes), and completion. Upon verification by a qualified valuer that each stage is complete, the corresponding funds are released to your builder.
Repayments During Construction:
As mentioned earlier, you’ll typically only pay interest on the amount of the loan used so far.
Transition to Traditional Mortgage:
Once construction is complete and all progress payments have been made, the loan converts to a traditional mortgage with full principal and interest repayments.