NEW CONSTRUCTION
New construction mortgage financing in Alberta
Financing a new build comes with unique considerations — from progress draw mortgages to builder deposits and construction timelines. I help buyers navigate the process with clarity.
Progress draw mortgages
When building a home, many lenders use a progress draw structure. Instead of disbursing the full mortgage at closing, funds are released in stages as the build reaches specific milestones.
Common draw stages include:
Foundation complete
~15% of mortgage
Framing complete
~35% of mortgage
Lockup (roof, windows, doors)
~35% of mortgage
Final completion
~15% of mortgage
Draw schedules vary by lender. I can help you understand the process and find lenders with favourable terms.
Builder deposits
Most builders require deposits at various stages — often when signing the purchase agreement, at design selections, and at construction milestones. These deposits typically range from 5% to 15% of the purchase price.
It's important to understand that builder deposits are separate from your mortgage down payment. When the home is complete and the mortgage funds, your deposits are credited toward the purchase price.
I help buyers plan their deposit schedule alongside their mortgage timeline to avoid any surprises.
Completion timelines and rate holds
New builds can take anywhere from a few months to over a year to complete. This creates a challenge with mortgage rate holds, which typically last 90 to 120 days.
If your build takes longer than your rate hold, you may need to re-qualify and accept the rate available at that time. Some lenders offer extended rate holds for new construction — I can help you find those options and plan accordingly.
Financing during construction
During the construction phase, you may need to manage costs like lot purchases, interim financing, and builder draws. If you're building on your own land, the financing structure can look quite different from a standard home purchase.
I work with lenders who understand construction financing and can structure a mortgage that accounts for the unique timeline and requirements of your build.