Oak Laurel | Bad Credit Construction Loans
Don’t let a bad credit stop you from getting a construction loan.
Bad Credit Construction loans: building loans for people with bad credit
Get a construction loan with bad credit
Having bad credit such as defaults, judgments and writs listed on your credit file does not mean that you cannot get a construction loan.
This could be a great option for those looking to build their dream home but fall outside the lending guidelines of the standard banks and lenders due to bad credit issues and wouldn’t usually qualify for a construction loan.
Contact Oak Laurel about a home loan despite having a default
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Enquire about a bad credit home loan now.
Contact us about a getting a construction loan with bad credit
An Oak Laurel mortgage broker will go through your situation with you to ascertain the best way forward.
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Enquire about a bad credit construction loan
90% for full doc applicants; and
80% for low doc applicants.
Of the fixed price and land value.
Fee capitalisation up to the maximum loan to value ratio limits allowed.
- an unlimited number of defaults, judgments and writs up to $1,000 (paid or unpaid); or
- Unlimited defaults, judgements and writs >$1,000 (paid or unpaid) listed >24 months.
Lenders will consider applicants one day after they have discharged from Bankruptcy.
Yes, both owner occupier home construction loans and investment property construction loans are available if you have a past credit issue.
The construction loan converts to home loan with principal and interest (P&I) repayments on completion of construction.
Bad credit construction loans require copies of the following documents prior to the date of the first progress payment:
- Copy of executed Fixed Price (inclusive of GST) building contract from a licensed builder (not owner builder) executed in standard HIA format);
- Council approved plans and specifications; – Evidence of Construction All Risk Insurance (including public liability) from the builder with a Certificate of Currency showing Pepper Finance Corporation Limited as mortgagee;
- A copy of the Builder’s insurance under the Home Building Compensation Fund (previously Home Warranty Insurance) covering the subject property during the course of construction;
- Certificate of registration of the builder; and
- Builder’s bank details on their letterhead.
- Up to 6 drawdowns scheduled prior to settlement
- Borrowers must use their full financial contribution at settlements i.e. at purchase of vacant land. This contribution is to be based on the loan to value ratio of the ‘As if Complete’ valuation
- Requests must be in writing signed by all borrowers (Progress Payment Authority – PPA)
- A copy of the builder’s invoice must accompany each PPA
- A survey certificate is generally requested when the first progress payment is required
- The WL partner manages the progress payment process including the payment of any progress inspections by the valuer
- Progress payments are paid into the builder’s bank account via EFT – Valuer (who completed the initial ‘as if complete’ valuation) to complete progress inspections as required (up to 6 depending on the loan characteristics and construction costs) prior to the release of each drawdown
- The cost of the progress inspections is at the borrower(s) expense
- Valuer’s final progress inspection report is to advise current valuation figure and confirm all works have been completed as per plans and specifications
- Prior to release of the final progress payment: Evidence of building insurance with the lender noted as first mortgagee, for an amount not less than replacement value as advised by the lender;
- A Certificate of Completion from council may be required – Copy of Occupancy Certificate for new homes only (not applicable for SA or WA)