If you’re thinking of investing in a home and land package in Perth, a construction loan may be the better loan option for you. Compared to regular home loans, construction loans are very much favourable for future homeowners who are building their homes from scratch because it allows them to draw money as is required while building, and interest is calculated based on the funds released. This type of phased payment approach allows a homeowner to pay only for what’s been built and not the entire home, as is the case with a regular home loan.
Maximising construction loan benefits depends a lot on the reliability and trustworthiness of your builder, so choose wisely. If costs go over the contract or the construction period falls behind schedule, you’ll have to pay for the balance out of your own pocket.
This is why you should only work with a licensed and established builder with a proven track record. When you meet with a builder, ask to see their license and some references. Research reviews on the Internet. Confirm that they have a history of completing builds on time and that they are known for quality workmanship.
With regards to lenders, different lenders will have different requirements, phases, and features with their construction loans, so it pays to research your options and shop around for the best deal.