Many Canadians are choosing to build custom homes with special features to suit their lifestyles. The process can be intimidating but not if completed with the right mortgage broker. We can give you the support you need from start to finish to guide you through the process and explain all the important details along the way.
Typically the construction process is done in three to four draws over a 9 month period however more elaborate homes can take up to two years. A Progress Draw is a type of funding, which is advanced in intervals as the house is being built. There are usually 3 draws at; 32% (lock up), 70% (dry wall) and 100% (completion). Each draw requires a progress Inspection report, which details the percentage complete prior to the advancement of funds. Essentially you are updating the appraisal with the current status of the project. Not to be confused with a Purchase Plus Improvements mortgage, the construction mortgage essentially starts from scratch. Getting a construction loan can be a challenging and complex process. Using an experienced mortgage broker can help you get approved quickly and with a great interest rate. Please see below for more details.
- Complete our online mortgage application
- Send us the requested documentation
- Order appraisal (half price through a mortgage broker)
- Obtain mortgage approval
- Construction mortgage instructions sent to lawyer
- 25% to 40% (Cost to build) is required capital
- Complete construction to first draw (typically 32% TO 40%)
- Order appraisal update or inspection
- Request funds from lawyer
- Rinse and repeat up to four times
- Income verification
- Cost to Build & construction drawings -appraisal
- Proof of capital for build