What is Construction Loan?
A construction loan funds the building of a home in staged drawdowns — slab, frame, lock-up, fit-out, completion. You only pay interest on what's been drawn. When construction finishes, the loan converts to a standard home loan.
Why it matters for you
Construction loans require a fixed-price builder contract, builder's warranty insurance, progress inspections and (usually) higher contingency provisions. Complex to set up but powerful for building wealth through new construction.
Last updated: April 2026