Construction loans in Gippsland | Sale, Traralgon, Warragul & surrounds
Are you considering building your own home from the ground up? Or perhaps significantly renovating your home? You will likely require a construction loan, which is a bit different from a traditional home loan. Let our team in Sale, Warragul & Traralgon find the one to suit your project.
A construction loan is tailored to the building process. This means that as the borrower, you are able to balance when payments need to be made to the builder - as they make progress with the build. The payments are usually made at key stages of the build process and are known as progress payments.
How does a construction loan differ from a traditional home loan?
Unlike a traditional mortgage where you pay principal and interest, a construction loan is an interest-only loan until the building process is finalised, after which the loan reverts to a principal and interest loan.
Due to the loan being progressively drawn down during the build, you’ll only be charged interest on the funds used so far. That means that if you have a $500,000 loan and you drawn down $150,000, you’ll only be charged interest on that $150,000 amount.
This can save you money during the build - funds you can put towards the project - instead of paying it to the bank!
What is involved in the process of applying for a construction loan in Gippsland?
You will need to produce a copy of the building contract/tender and the building plans to apply for a construction loan in Gippsland. The lender will organise a valuation to determine the potential market value of the property as-if-complete.
Some lenders may require ongoing independent property valuation and inspections before paying each instalment. This is done to make sure that everything is on track and within budget. This is also a great safeguard for you - it allows you to hold your builders or contractors accountable - so they are not being paid for unsatisfactory or incomplete work.
How can Mortgage Choice in Sale help with your construction loan?
Mortgage Choice in Sale will guide you through the construction loan process and help you understand all your options. Our Gippsland team will remove the hassle and stress out of finding the right construction loan from our wide range of lenders, by doing all the research, paperwork and follow-up for you.
"Our experience with Dane in Sale & Traralgon was great. The process was easy and straight forward and we found Dane really helpful right throughout. Thanks Dane. Will definitely recommend to others!" [Brooke Martin, Warragul]
The new $25,000 HomeBuilder Cash Grant
If you are looking to build or significantly renovate your new home in the next 6 months, the HomeBuilder Cash Grant could give you $25,000 towards your budget. In July 2020 the government announced the new grant to help support the residential construction industry.
Eligibility for HomeBuilder Grant:
- Be an Australian citizen aged 18 years or older and be an individual, not a company or trust.
- Be on an income of less than $200,000 for couples, and $125,000 for singles.
- Be spending between $150,000 and $750,000 on a renovation for a home that has been previously valued at less than $1.5 million.
- Be building a new home worth less than $750,000 (this includes land value).
Find out more information in our blog: The New HomeBuilder Cash Grant
Some resources to help guide you
Let's chat about your next step
The right finance behind your house build or renovation can reduce interest and help it work better for you in the long run. Dane and the Mortgage Choice team in Sale & Warragul can help you find and structure the right construction loan from over 20 lenders.
Our Gippsland mortgage broker team are mobile and come to you when convenient throughout the Sale, Warragul, Traralgon & surrounding areas. Alternatively, we have a conveniently located shopfront at 285 Raymond St in Sale (near the clock tower). During COVID-19 Stage 3 restrictions, we can help you via video or phone.
Book an appointment with our Gippsland team on (03) 5144 3265 or call Dane directly on 0438 626 885.
We service the Gippsland areas of Sale, Traralgon, Warragul, Inverloch, Wonthaggi, Leongatha, Morwell, Churchill, Moe, Heyfield, Maffra, Rosedale, Bairnsdale, Paynesville, Lakes Entrance and surrounds.
