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28 Jul

What extra documents are needed for construction?


Posted by: Joel Olson

When doing a construction mortgage, there are several other documents that you will need to supply.


  • Blueprints/Plans- you must have plans for your house that you are building. The plans that you submit to us, must be the plans that have been approved by the city. They are also the plans that the appraiser will rely upon
  • Construction Contract- you must have a contract with the builder you are using outlining all costs, timelines, and terms he is wanting from you. Common issues with builder contracts are:
    • Cost Plus Contracts- this is where a builder has the ability to increase the cost as the project goes. There is really nothing more dangerous than this. A contractor will need to provide you with a Fixed Cost Contract- which means the price is fixed the same. However, you must be aware that if you change anything in the contract a contractor can change their price.
    • Builders Liens- the government requires 10% to held back of every draw. When a contractor puts in the contract that you are to ignore this- this is illegal. Here is a great article on how this can effect you:¬†
    • Payment schedule. You will generally be given four different draws at quaretly stages. Unless, you have cash reserves in which to pay in the interim, a construction mortgage will not allow getting paid every two weeks or weekly. Payment are made on completion and not on time frame.
  • Detailed list of quotes and contractors building the house. The above contract should have it, but if you are self-building you will have to supply
  • Building Permit
  • Home Protection Office Registration- you must register and receive a certificate for this.
  • New Home Warranty- you must get this regardless of whether you are self-build or contractor-build
  • Site Survey
  • Cost of Construction Fire Insurance- you must get insurance PRIOR to building on the lot


Some of these documents cannot be supplied till after financing is approved, but all documents must be supplied prior to a second draw.


For a look at how construction works check out our video on it