Construction mortgages:
building your own home?
We fund each stage as you build.
Money released in stages — foundation, framing, lock-up, completion — to match your builder's invoices. Borrow up to 80% of the finished value, with insured progress-advance options for owner-occupied builds.
A construction mortgage in Canada is a draw mortgage — funds are advanced in stages as the build progresses, not as a single lump sum. Each draw is verified by a cost-to-complete appraisal; you pay interest only on the drawn portion during construction. On completion, the construction facility converts to a standard term mortgage. Most lenders require 20–25% down based on the completed value.
Construction financing
that moves with your build.
We coordinate draw inspections, builder vetting, holdback timing, and take-out conversion — so trades stay paid and your build stays on schedule.
Funds released by stage
Money advances at 3–5 milestones — foundation, framing, lock-up, drywall, completion. You carry interest only on what has been drawn, so your carrying cost starts low and rises as the home takes shape.
Converts to a permanent mortgage
At occupancy the construction facility closes out and converts to a standard fixed or variable take-out mortgage — one process, one advisor, from first draw to final registration.
Owner-builder programs available
Managing your own trades? Owner-builder programs exist at specialist lenders. We know which ones work for your profile and what documentation — HCRA status, detailed budgets, inspection schedule — each requires.
Borrow up to 80% of finished value
Lenders size the loan against the as-complete appraised value, not the lot today. Insured progress-advance mortgages on owner-occupied builds under $1.5M can go further with 5% down on the first $500,000.
Pre-approval
to occupancy —
three stages.
Lender selected. Builder vetted. Draw schedule planned. We coordinate everything so no milestone catches you off guard.
Pre-Approval + Builder Vetting
We confirm you qualify based on the home's completed value. The lender vets your registered builder — or reviews your owner-builder plan, budgets, and HCRA documentation — before a dollar is committed.
Draw Schedule
Funds release at agreed construction milestones. In Ontario a 10% lien holdback is retained per the Construction Act until the 60-day lien period after completion passes — we plan your cash flow around it so trades aren't left waiting.
Convert at Occupancy
Final advance funds at substantial completion. Your construction mortgage converts to a regular 5-year fixed or variable and begins amortizing principal and interest like any standard mortgage.
We can help across
every build scenario.
Tap any situation below to see how we approach it.
If you’re…You're building a custom home with a registered builder
You're building a custom home with a registered builder
The most straightforward path. A fixed-price contract, a vetted GC, and a clear draw schedule give lenders confidence — and you access to 80% of the completed appraised value with competitive rates.
Start my construction fileIf you’re…You want to buy a lot now and build later
You want to buy a lot now and build later
Combined lot + build mortgages fund the land first; construction draws follow. We can also help with standalone land financing if you're not ready to break ground yet.
Explore lot + build financingIf you’re…You're an owner-builder managing your own trades
You're an owner-builder managing your own trades
Owner-builder programs are available but demand more: detailed budgets, confirmed HCRA status, and tighter inspection scrutiny. We know exactly which lenders are most open to self-managed builds and what they need to say yes.
Start my owner-builder fileIf you’re…Your build has hit a budget overrun
Your build has hit a budget overrun
Common on every project. If the completed value supports it, we can sometimes increase the construction mortgage. Otherwise a short-term private bridge or HELOC supplement keeps trades paid and your schedule intact.
Explore bridge optionsIf you’re…You're worried about rate exposure on a long build
You're worried about rate exposure on a long build
Some lenders offer extended rate holds on construction files. Others set the take-out rate near completion. We confirm the structure before you commit — so a 14-month build doesn't leave you exposed to a rate spike at occupancy.
Plan my rate protectionIf you’re…You're doing a major structural renovation
You're doing a major structural renovation
Structural renos can use a draw structure similar to new construction. See our dedicated renovation mortgage page for the full picture — especially if load-bearing walls are coming down.
See renovation mortgageInterest only on
what's been drawn.
The biggest advantage of a draw mortgage: your carrying cost starts low and builds as your home does.
- Loan amount$600,000
- Loan typeLump-sum
- Rate5.5%
- Monthly interest~$2,750
- Interest over 12 months~$33,000
- Total interest during build~$33,000
- Foundation draw$120K drawn
- Framing + lock-up$200K drawn
- Drywall + finishing$420K drawn
- Completion$600K drawn
- Avg monthly interest~$1,375
- Total interest during build~$16,500
Illustrative only — draw amounts, rates, and timing vary by project and lender. Actual interest savings depend on your draw schedule and advance amounts.
Draws, holdbacks,
and conversions —
answered plainly.
From draw schedules to owner-builder rules — the questions every construction borrower asks.
How many draws are typical?
3–5: foundation, framing/lockup, drywall/finishing, completion (+ holdback release). Some lenders offer 2-stage draws on smaller renos.
Do I pay interest during construction?
Yes, on the drawn balance only. Interest is usually payable monthly on the amount drawn; some lenders allow it to be capitalized or paid from the next draw.
Do I need a contractor?
Most lenders prefer a registered contractor. Owner-builder programs exist but require more documentation and inspection. In Ontario, owner-builders should confirm their status with the HCRA, and may be able to claim the GST/HST new housing rebate for owner-built homes (CRA form GST191).
Can I include the lot purchase?
Yes — combined lot + build mortgages are common. The lot is funded first; build draws follow.
What's a holdback?
A 10% holdback retained under Ontario's Construction Act (formerly the Construction Lien Act) until the lien period ends, generally 60 days after the contract is completed, abandoned or certified substantially performed. It's released if no liens are registered in that time.
Can I do a major reno on this product?
Major structural renovations can use a draw structure; see our home renovation mortgage page for details.
What's the rate during construction?
It varies by lender. Some charge a modest premium or a floating rate on advanced funds during the draw period; others hold a rate for the take-out. Your rate converts to the permanent mortgage rate at occupancy. We confirm the lender's structure before you commit.
What if my build goes over budget?
Common issue. We can sometimes increase the construction mortgage if completed value supports it. Otherwise, a HELOC or short-term private supplement works.
We’ll try to beat your rate.
If we can’t, we pay you $500.¹
¹ Rate Beat: eligible Big-6 bank written offers only · same product, term & amount · $500 paid to you or your nominated charity at closing · conditions apply
Find a construction mortgage specialist in your city
Construction financing rules, lender appetite, and builder networks vary by market. Our advisors know which lenders are most active in your region and which ones are friendliest to owner-builder files.