Save money when you build your dream home with interest only repayments
Whether you're building a home or purchasing a property with the intent of a house construction, the ING Direct Construction Home Loan will assist you with a competitive variable interest rate and no fees to worry about. Once your home is move-in ready, the construction loan will revert to the Mortgage Simplifier.
Removed from market
ING DIRECT no longer offer the Construction Loan to new customers as of 31 October 2015. This page serves as an informational source only predominantely for customers who already have this loan.
Things to consider about the ING Direct Construction Home Loan
The Construction Home Loan from ING Direct allows you the time you need to plan and build your new home. It gives you up to 12 months from loan settlement to start your construction, and an additional 12 months to complete construction.
Once the construction period ends, the construction loan will revert to a Mortgage Simplifier home loan.
Be advised that at the end of construction an additional valuation may be required, resulting in an additional charge to the borrower.
Features of the ING Direct Construction Home Loan
- Loan to value ratio (LVR). You may borrow up to 95% of the value of the property in order to begin construction. Loans that are 80% or less of the value will not bear the additional cost of Lender’s Mortgage Insurance (LMI).
- Loan terms. You will have up to 2 years from the time of settlement to complete your construction. At that point the loan will revert to a Mortgage Simplifier which has terms of 1 to 30 years.
- Repayment frequency. You will be required to make monthly payments on your construction loan, but once this reverts to the Mortgage Simplifier you'll be able to make fortnightly payments.
- Repayment type. This is an interest-only repayment loan allowing you extra cash to finish construction. The interest is calculated on the amount drawn down and paid by you progressively.
Fees you can avoid
- Application fee. There are no application or establishment fees with this loan.
- Settlement fee. You will not have to pay any additional fees when the loan is settled.
- Maintenance No monthly administrative charges are applied to your balance.
Fees you can’t avoid
- Legal fee. Starting at $0, this fee could change depending on the circumstances of your loan.
- Valuation fee. You are responsible for the valuation of the property at a cost of at the completion of construction if there was a valuation done by ING DIRECT at the start of the loan.
- Discharge fee. At the completion of your construction you'll be charged a $250 discharge fee.
How to apply for the ING Direct Construction Home Loan
In order to ensure that you will be eligible for this loan, make sure first that you will be able to meet the following mandatory requirements:
- Income. You will have to provide a pay stub that is less than one month old or evidence of salary crediting.
- Identity. Applicants must be able to fill out a verifying identity form and provide copies of valid photo ID’s.
- Property owners. Any rates notices for property that you own.
- Construction loan. A copy of your building contract for a fixed property and proposed building plans.
Be prepared with the following documentation to answer all of the questions:
- Personal information. The full name and contact information for all applicants.
- Employment. You will have to disclose all of the details of your current employment including your employer's contact information.
- Assets. A complete listing of any other properties, cars or other assets that you currently own.
- Liabilities. Details of your current liabilities, including mortgages, loans and credit card debt. You will have to be able to provide the name of the financier as well as your monthly payment amount.
- Income. The income details for any applicant listed. This should include your base salary along with investment, rental or other types of income you receive regularly.
When building a new home, your first priority will be that the financing is there to bring the project to completion. When comparing construction loans such as this one with others, make sure that the terms granted permit you enough money and time for the house to be completely built.