Builders and land investors usually discuss construction loans instead of a traditional residential mortgage. When you purchase an existing house or doing refinance an existing property, the residential loan is advanced the full amount on the closing day. The construction mortgages are given on a progress advance basis, which means the amount you borrowed is given based on construction stages, known as “draws”.
If you have owned a land, then the first advance normally is to take out the equity from the land, and then initiate the construction project and achieve each milestone to get the next “draw”. If you have not yet bought the land, we should start by purchasing land and trigger the next steps.
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85 Scarsdale Road, #107
Toronto, ON M3B 2R2
