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Construction Home Loan Frequently Asked Questions

If you haven’t used a finance broker before, you probably have some questions. Let’s help you get some answers.

Can construction loans be fixed?

Construction loans can have fixed interest rates, and these are commonly referred to as “fixed-rate construction loans.” In a fixed-rate construction loan, the interest rate remains constant throughout the loan term, providing borrowers with predictability and stability in their interest payments.

Can construction loans be refinanced?

Yes, construction loans can be refinanced, but the process and options available may differ from refinancing a traditional mortgage loan. Because construction loans are generally more complicated than traditional home loans, refinancing can require more documentation and a more complicated process.

Can construction loan interest be deducted on taxes?

If you are building an investment property, then interest on construction loans may be tax deductible. However, it is important to confirm what deductions you are eligible for with your accountant or with the Australian Taxation Office (ATO).

Does a construction loan include appliances?

A construction loan typically covers the costs directly associated with the construction or renovation of the property itself, including labour, materials, permits, and sometimes land acquisition. Appliances, furnishings, and other personal property are generally not considered part of the construction costs covered by the loan. However, there are some exceptions, depending on the type of construction loan and the lender’s policies.