Construction loans differ from standard home loans. Instead of receiving the full loan amount upfront, funds are drawn down in stages as your build progresses. This means you only pay interest on the amount drawn, not the total loan.

Key features include:

• Progress payments — funds released at key milestones (e.g., slab, framing, lock-up, completion)
• Interest-only during build — lower payments while construction is underway
• Land purchase — the loan can cover both land and build costs
• Contingency buffer — many lenders require a contingency for cost overruns