How much can I borrow?
What other costs do I need to budget for?
When drawing up your budget, factor in other upfront costs. While builders and suppliers will make up a large percentage of your budget, also allow for:
- Rent while you’re building
- Site inspections
- Solicitors fees and conveyancing
- Local council levies and permits
- Stamp duty
- Fixtures, fittings and furniture
Things to consider
Find out more
What steps are involved with a construction loan?
To help you navigate through the process, here are some handy tips.
To apply for a construction loan you will need copies of:
- A planned Building Contract, with the Payment Schedule and Specifications of Construction (this need to be a signed contract by both you and your builder).
- The construction plans to be lodged with your local council.
- Final executed Building Contract, including the Payment Schedule and Specifications of Construction.
After your loan is approved, you will need to provide these documents to release the funds to your builder:
When the loan is approved, send the documents below to release the funds to your builder:
- Council-approved construction plans
- Evidence of your builder’s All Risk Insurance
- Your First Home Owners’ Grant approval (if applicable).
Three valuations will need to happen throughout the construction:1. Initial valuation – this is done at the loan application stage
2. Lock up stage valuation – when the home is about 50% complete
3. Final valuation – upon full completion.
Each valuation will take about five to seven business days to complete.
There are usually six stages of payments throughout the build:
6. Final Completion
Progress payments are made once we receive a valid invoice and a signed Progress Payment Request form.
Ask your builder to include on their invoice:
- ABN and company details
- Address of where renovation/construction is taking place
- What stage they’re claiming for
- GST amount
- Invoice number and date
- Builder’s bank account details, including BSB number.
Once your house is built, the final progress payment will be made when we receive a:
- Certificate of Occupancy (C of O) & Use (provided by your builder)
- Council Final Inspection Certificate/Final Occupation Certificate (not needed in Western Australia).
- Copy of your building insurance noting CUA as the financier.
- Valuation from a valuer confirming the work has been completed as per the contract.
What is the best loan for me?
A construction loan is an ideal option if you’re building or buying land to build on. It helps to reduce your interest payments during construction, as you draw down your loan in progress payments while you build.
Construction loans are interest only for the first 12 months of the building phase. Once finished, you stay on the same loan (for example, a CUA Fresh Start Variable Rate Home Loan), but for variable rate loans it transfers to principal and interest home loan. For fixed-term loans, it’s interest only for the fixed rate period.
All of our home loans are available for construction, apart from our equity line of credit. Use the home loan selector tool below to find the right one for you.
Fixed vs variable rates
Fixed rate loans Show content
- Provide security because your repayments are set for a period of time.
- Protect you against rate rises, but you won’t benefit from a fall in rates.
- Are usually less flexible - if you change financial institutions, sell your home, or pay off your loan within the fixed period, you may be charged an early payout fee.
Variable rate loan Show content
- Give you more flexibility, but leave you open to changes in interest rates.
- Usually have more features – like an offset account, the ability to make extra repayments and to pay off or move your loan without penalty or early payout fees (but they may have a discharge fee).
Which home loan suits me?
Fixed Rate 2 Year – Principal & Interest #95%90%Fixed3.75 %
Owner occupier3.94 %
Investor rate5.02 %
Comparison rate5.49 %
Achieve Variable – Principal & Interest 1,390%90%Variable3.75 %
Owner occupier4.08 %
Investor rate3.80 %
Comparison rate4.13 %
Accelerate Variable – Principal & Interest 295%90%Variable3.79 %
Owner occupier4.22 %
Investor rate3.84 %
Comparison rate4.27 %
Premium Fixed Rate 2 Year – Principal & Interest #95%90%Fixed3.87 %
Owner occupier4.06 %
Investor rate5.04 %
Comparison rate5.52 %
Premium Fixed Rate 3 Year – Principal & Interest #95%90%Fixed3.99 %
Owner occupier4.11 %
Investor rate4.96 %
Comparison rate5.39 %
Fresh Start Basic Variable – Principal & Interest 495%80%Variable4.32 %
Owner occupier5.08 %
Investor rate4.34 %
Comparison rate5.14 %
Fresh Start Variable – Principal & Interest95%80%Variable4.51 %
Owner occupier5.16 %
Investor rate4.53 %
Comparison rate5.18 %
Equity Line of Credit80%80%Variable5.56 %
Owner occupier5.56 %