Construction Loans › How much deposit do I need for a construction loan?

How much deposit do I need for a construction loan?

Deposit is usually assessed on the combined value of the land plus the building contract. Many borrowers aim for around 20 percent to avoid lenders mortgage insurance, though lower deposit options exist with some lenders.

Written by Ross McFarlane, Licensed Mortgage Broker (Credit Representative 526725). About the author

Why this matters

Your deposit is measured against land plus build, not just one part. Reaching around 20 percent of that total avoids lenders mortgage insurance and opens more lenders, but smaller deposits are possible with insurance or a guarantor. A broker can show how your deposit changes the loan and the rate available.

The key points

Deposit is assessed on land plus build combined.
Around 20 percent avoids lenders mortgage insurance.
Lower deposit options exist with some lenders.
A guarantor can reduce the deposit needed.

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Last reviewed: June 2026

General information only. This page provides general information about home loans and is not financial or credit advice, a quote, or a guarantee, and your personal circumstances have not been considered. Lending policies, interest rates, fees and eligibility vary by lender and change over time. Always confirm your own situation with a licensed mortgage broker or lender before acting. Ross McFarlane (Credit Representative 526725) is an authorised Credit Representative of Australian Associated Advisers Pty Ltd t/a Keylend, Australian Credit Licence 392169.