Construction Loan Broker in Auckland
Whether you are looking to build your own dream home or looking to erect a residential dwelling(s) Or Commercial property then, no doubt a construction loan is for you. It is short-term funding typically for 12 – 18 months. Loan drawdowns are in line with the progress of the project. Construction Loan Broker generally prefers a Fix Price Contract that provides certainty around the total construction cost and may verify the progress of the project.
Once the construction is complete and the loan is fully drawn, following are the options one can choose from:
- Partially pay off this loan
- Pay the loan in full subsequent to the realization of the property(s). If you had plans to sell.
- Convert the construction loan into a home loan or business loan depending on the product type that lender approved
Key attributes of construction loan:
- It is worth noting, Construction loan can’t be fixed until it is fully drawn
- Construction loan remains on lender floating rate therefore, interest expense is higher than fixed interest cost
- Only interest cost (no principle repayments) is payable on construction loan