Building your own home is a different path than buying one, and so is the financing. Instead of one lump sum, the money comes in stages tied to the build, then settles into a regular mortgage at the end. Here is how a homeowner custom build is financed and what to plan for.
Financing the land is the first piece; lenders want your plan for it.
Money is advanced in stages as the build progresses and is verified.
You typically pay interest only on the funds drawn while building.
A buffer for overruns is expected, and wise.
At the end it becomes a regular mortgage, or is repaid by your take-out financing.
Your plans and budget, a fixed-price or detailed build contract, your builder, your equity in the project, and a realistic timeline. The clearer the file, the smoother each draw.
Lead time to arrange the financing, carrying your current housing cost while you build, and a contingency for surprises. A build rewards planning more than almost any other purchase.
Bring us your lot, your plans, and your builder, and we will map how the financing comes together stage by stage. A licensed member of our team will follow up.
Start a conversationInformation here is general and educational. It is not financial, legal, or lending advice, and it is not an offer of financing. Construction financing, draw schedules, holdbacks, and how the loan settles at completion vary by lender and province. Any figures are illustrative only. All financing is subject to lender and project review and supporting documentation. Submission of a form does not guarantee approval or financing.