Building a home to live in? An indicative answer on the build loan within 2 business days.
- Indicative assessment within 2 business days, with approval typically 2 to 6 weeks
- Loans from $100K to $2M, sized on the land, the building contract and the finished home's value
- Owner-occupiers building on land they own, land they are buying, or after knocking down the old house
- Progress payments by stage from slab to handover, with interest charged only on the amount drawn
- Full-doc (tax returns), low-doc or alt-doc (BAS, bank statements or an accountant's letter instead) options across our 90+ lender panel
You have the land, or you are about to settle on it, and a builder has handed you a contract. A construction home loan is the finance for that stage of owning a home. The lender approves the full amount up front but pays it out to the builder in parts, as each stage of the house is finished. Interest is charged only on what has been paid out so far. The loan is sized on the land, the contract price and what the house is expected to be worth once it stands. Lenders read the contract closely, and its terms shape which of them will fund it. Joseph Farhat and his team can look at your contract, your block and your income, and tell you what is realistic across 90+ bank, non-bank, and specialist lenders.
Who we can help access finance
- People who own a block of land and have a fixed-price contract from a builder ready to sign.
- Buyers of a lot in a new estate who want the land and the house funded under one approval.
- Owners demolishing their current house to rebuild on the same block, who will rent somewhere else while the work is done.
- Self-employed people and ABN holders whose most recent tax returns lag what they earn today.
- First home buyers building new, who want to understand the deposit, the stages and the repayments before they commit.
- People whose builder wants evidence that finance is approved before taking a deposit.
- Owners part way through a build whose variations have pushed the cost past the approved loan amount.
How Construction Home Loans Work
The lender approves one total amount: the land, if you are buying it or still owe money on it, plus the contract price. A land purchase is paid at land settlement and the rest waits undrawn. At the end of each stage, the builder invoices, you authorise the payment, and the lender may send an inspector or valuer before releasing it. Many lenders follow a pattern close to slab, frame, lock-up, fit-out and completion. Because interest is charged only on the balance drawn, the repayment grows as the house goes up. Before the first stage, lenders want the signed contract, plans, building approval and evidence of the builder's home warranty cover. After the final stage, the loan carries on as an ordinary home loan.
Joseph Farhat and his team review the contract, the land and your income, match you to the right lender from the 90+ panel, and manage the application through to the final stage payment. We are a finance broker, not a lawyer or a building consultant. A solicitor or conveyancer can review the building contract with you before it is signed.
What Lenders Assess for Construction Home Loans
The building contract
a fixed-price contract with a licensed builder gives the lender a known total. Cost-plus contracts (where the final price follows the builder's actual costs), or hiring separate trades yourself, shorten the lender list.
The finished value
the valuer works from the plans and specifications to value the house as if complete.
Your deposit and the LVR
the loan-to-value ratio (LVR), the loan as a share of the property's value. Borrowing more than 80% usually means lenders mortgage insurance (LMI), a one-off cost that protects the lender, not you.
Repayments while you build
if you are renting, or paying a mortgage on your current home, lenders test that cost alongside the new loan. APRA expects banks to check that you could still afford the repayments if interest rates rose by 3 percentage points (the serviceability buffer), a setting it confirmed on 28 May 2026.
Your income evidence
payslips, or tax returns or alt-doc evidence if you are self-employed. Lenders verify income on every path.
The builder
licence, home warranty cover and trading history.
Room for variations
the contract's allowances for items not yet priced, and the savings you hold for later changes.
The Construction Home Loan Process: What to Expect
- Talk to Joseph Farhat and his team about the land, the builder's quote and your income. If the contract is not signed yet, bring the draft.
- Share the documents: the contract and plans, the land contract or title, your income evidence and any current home loan details.
- We compare lenders on the panel against your contract and position, and set out the trade-offs in pricing, deposit and stage payments.
- The lender values the finished home on the plans and issues an approval with the stage schedule. We go through it with you before you sign.
- The land settles if you are buying it, the builder starts, and each stage is checked and paid.
Indicative Finance Options
| Lender Type | Pricing | Max LVR | Typical Loan Range | During the Build | Speed to Approval |
|---|---|---|---|---|---|
| Bank | Sharpest available pricing | Up to 90% with LMI | $100K to $2M | Interest on the drawn balance only; interest-only repayments with many lenders | 2 to 6 weeks |
| Non-Bank Lenders | Priced for flexibility | Up to 80% | $100K to $2M | Interest on the drawn balance only; alt-doc and low-doc options | 2 to 4 weeks |
| Private Finance | Not typically used to build an owner-occupied home. Available for unique scenarios only. | ||||
Indicative figures only. Actual terms depend on your circumstances, the property, and lender assessment at the time of application. We quote your rate and comparison rate for your specific loan amount and term before you apply. Terms are subject to change.
Why borrowers choose Settled With Joe for construction home loans
We represent you, not the lender
on consumer lending Joseph Farhat and his team owe you a best interests duty, from the first call to the last stage payment.
The contract read with lenders in mind
the payment schedule, inclusions and price all shape which lenders will fund your build, so we look at them early.
Stage schedules matched
some lenders release payments on their own pattern and others follow the contract, and a mismatch can hold up the builder.
Variations talked through up front
we cover how a change to the contract is paid for before the slab is poured.
One conversation, not five applications
each credit enquiry is recorded on your file, so we approach the lender that suits your build first.
90+ lenders on one panel
bank, non-bank, and specialist, so a clean file and a fixed-price contract can go to a bank at a sharper rate.
Private finance for unique scenarios
where bank and non-bank lenders are not the right fit, we can introduce you to private finance options.
Usually no direct cost to you
as a broker we are typically paid by the lender on settlement.
An honest answer early
if the numbers do not reach the build you have priced, we will say so and show you where the gap sits.
Frequently asked questions
What is a construction home loan?
A construction home loan is a home loan for building a new house you plan to live in. The lender approves the full amount at the start, then pays it out in stages as the build moves along, charging interest only on the amount paid out. It can include buying the land, or it can sit over land you already own. When the house is finished, it becomes a standard home loan with regular repayments for the rest of the term.
Will applying affect my credit score?
Every application for credit is recorded on your credit file, whether it is approved or not. Several applications in a short period can read poorly to the next lender. Building a home can involve two pieces of finance, one for the land and one for the house, so the count adds up quickly when each is applied for separately. We work out which lender suits the land, the contract and your income before anything is lodged, so the build goes to one lender first.
What is a comparison rate, and why are no rates shown on this page?
A comparison rate rolls the interest rate and the standard fees into one figure, so loans can be compared on equal terms. It only holds for a set loan amount and term, so a single headline rate would say little about your build. Construction loans can also carry fees that a standard home loan does not, and the comparison rate is where those show up. We give you the rate and comparison rate for your actual loan amount and term before you apply.
Do you work with borrowers with bad credit?
Yes, we do. A default, a past arrears listing or a thin credit file does not rule you out of building a home, and there is no judgement in the conversation. Lenders look at how recent a listing is, whether it has been paid, and how your accounts have run since. Some lenders on our panel give more weight to your income, deposit and building contract, and price for the risk rather than decline. Telling us at the start lets us approach the right lender first.
Do you act in my best interests?
Yes. When we provide credit assistance on a consumer loan, we owe you a best interests duty, and where our interests and yours conflict, yours come first. We make reasonable inquiries into your requirements, objectives and financial situation, and take reasonable steps to verify it. On a build, that includes checking the loan covers the land and the contract, and that repayments fit once the house is finished. We must not suggest a loan that is unsuitable for you. You receive our Credit Guide before we provide credit assistance.
How are progress payments released to the builder?
Your contract sets out the stages and what each one costs. In NSW, a contract over $20,000 must include a progress payment schedule, and each payment is either a fixed amount after a defined stage or charged as invoiced for work done. The contract also carries a cooling-off period of 5 clear business days. Where a lender's own schedule differs from the contract, we look for that before the contract is signed.
What repayments do I make while my home is being built?
With many lenders, repayments during the build are interest only, charged on the amount drawn so far. If the loan includes the land, you pay interest on that part from land settlement. As each stage is paid, the balance and the repayment rise. When the home is finished, the loan usually moves to principal and interest. If you are paying rent, or a mortgage on another home, at the same time, lenders assess whether you can carry both.
What insurance does my builder need before I pay a deposit?
In NSW, a builder needs home building compensation cover for residential work worth more than $20,000, and must give you evidence of it before taking any money, including a deposit. The deposit is capped at 10% of the contract price in NSW. In Victoria, Home Warranty insurance applies from 1 July 2026 to work worth more than $20,000 on homes of 3 storeys or less. The Victorian deposit cap is 5% for contracts of $20,000 or more, and 10% below that. NSW Fair Trading and Consumer Affairs Victoria publish the full rules.
What happens if variations push the cost above the loan?
A variation is any change to the contract after it is signed, whether you ask for it or the builder finds something on site, such as rock under the slab. The lender approved a set amount, so the extra usually comes from your savings or from a loan increase, which the lender assesses again. If variations have already run past the loan, Joseph Farhat and his team can look at whether an increase or a refinance is possible.
What if the finished valuation comes in lower than the land and build cost?
The lender lends against its own valuation, not the price you agreed with the builder. If the valuation is lower than the land and contract combined, the difference comes from a larger deposit, or a lender may lend a higher share with LMI if your position supports it. A different lender's valuer may reach a different figure, and we can check that. Seeing the likely valuation before the contract is signed helps avoid a shortfall in the middle of the build.
Can I buy the land and fund the build under one loan?
Often, yes. Many lenders approve the land and the build together, settle the land first, then release the build funds stage by stage. Some buyers settle the land with one loan and arrange the construction loan once plans are approved and a contract is signed. Either way, lenders assess your position at the time you apply.
Why work with Settled With Joe to arrange your construction home loan?
Because one conversation covers the land, the contract and the loan together, instead of separate applications to lender after lender. We help people buying a lot on a new estate, owners rebuilding on their own block, first home buyers, and self-employed people whose income takes more work to show. There is no judgement in the conversation. What matters is the contract, the finished valuation, your deposit and what you can repay once the house is done. Our panel covers 90+ bank, non-bank, and specialist lenders, so a clean file can go to a bank at a sharper rate. We are based in Sydney and work with borrowers Australia-wide. Joseph Farhat and his team will tell you honestly and early what is achievable.
Do you give financial advice?
No. We do not guide you on your finances, nor give financial advice. We focus on outcomes and solutions of presenting your unique scenario to the right lender so you can access funding in a timely and compliant manner.
Do you help with construction home loans outside Sydney?
Yes. Settled With Joe is based in Sydney and arranges construction home loans Australia-wide, covering both metro and regional areas. We work with clients in Sydney, Melbourne, Brisbane, Perth, Adelaide, and Canberra, as well as regional areas including Newcastle, Wollongong, Geelong, Gold Coast, Sunshine Coast, and Toowoomba. Deposit caps, contract rules and home warranty schemes differ by state, and lender appetite for construction can vary by location. Joseph Farhat and his team will identify which lenders on the panel suit your block and your builder.
