MetroYEG Realty & Mortgage Team | Award Winning Edmonton Realtors & Mortgage Brokers : New Home Construction Mortgages in Edmonton

New Home Construction Mortgages

Building a home from the ground up comes with its own financing rules. Here's how draw and completion mortgages work, and how to protect your rate while your home takes shape. Buying a new build is a different process than buying a resale home — your closing date might be a year or more away, and your financing needs to be structured to match. Whether you're working with a builder on a show home lot or building on land you already own, the mortgage you choose affects how funds are released, when payments start, and how protected you are if rates move before you take possession. We'll walk you through your options and help you land on the one that fits your build.

Completion vs. draw mortgages — what's the difference?

There are two main ways to finance a new build in Alberta: a completion mortgage or a draw (progress-draw) mortgage. Your builder's contract usually points you toward one or the other, but it helps to understand both before you sign anything.

Completion Mortgages

With a completion mortgage, the full loan amount is advanced in one lump sum once your home is finished and you take possession — similar to how financing works on a resale home. Your builder carries the cost of construction, and you don't start making mortgage payments until you move in.

Access to listings: I have access to a wealth of listings, including homes that may not be publicly listed, giving you more options to choose from.
Expertise: I have a deep understanding of the market and can provide valuable insights and advice on factors like home values, negotiation strategies, and closing costs.
Negotiation skills: I am an experienced negotiator and can help you get the best deal on your new home.
Handling paperwork: The home-buying process involves a lot of paperwork, and I can help you navigate it all, from the offer to closing.
Stress relief: Buying a home can be stressful, but I can take some of the burden off by handling the logistics and communicating with other parties involved in the transaction.

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Draw Mortgages

A draw mortgage releases funds in stages as construction hits agreed milestones — foundation, framing, and so on — with a lender-appointed appraiser confirming progress before each draw is released. This is the more common route if you're building on land you already own or working with a smaller custom builder.

Pros:

You only pay interest on the funds that have actually been drawn, not the full loan amount
Works for custom and owner-lot builds where a builder isn't self-financing

Cons:

More paperwork and coordination, with each draw requiring lender sign-off
Interest payments start during construction, before you're living in the home
Delays in inspections can hold up a draw and slow down progress

Extended rate holds for new builds

A standard mortgage pre-approval usually holds your rate for 90 to 120 days — plenty of time for a resale purchase, but not nearly enough for a build that could take 6, 12, or even 18 months to complete. That's where an extended rate hold comes in.

Many lenders offer new-build rate holds in the 6 to 12 month range (with some going longer, depending on your builder's timeline and the lender), which locks in your rate while your home is under construction. This can be very beneficial to have this in place in case rates were to increase over the timeline of your build.

We can help match your build timeline to a lender that offers a hold long enough to actually cover it, instead of finding out four months in that your rate has expired.

Ready to make a move?

If you're not sure yet which situation you're in, that's a completely normal place to start — we can walk through everything with you, step by step & get a tailored plan in place

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FAQ's

Our Team of professionals is here to guide you each step of the way

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I’m a first-time homebuyer. Where should I start?

Start by speaking with a mortgage professional to determine your budget and get pre-approved for financing. Then, we can discuss your needs, preferred locations, and must-have features so we can begin your home search with a clear plan.

How long does it usually take to buy a home?

The timeline varies depending on the market and your needs. Some buyers find a home within days; others may take a few months. Once you’ve made an offer, the closing process typically takes 30–60 days.

Do I have to pay a real estate agent to help me buy a home?

In most cases, the seller covers the buyer’s agent commission, so you can benefit from professional guidance at no direct cost to you.

How do you determine my home’s value?

We perform a Comparative Market Analysis (CMA) to assess recent sales, current competition, and market trends. This helps us set a competitive price that maximizes your return while attracting serious buyers.

How long will it take to sell my home?

This depends on market conditions, location, pricing, and presentation. On average, homes can sell in days to weeks in a strong market, but slower conditions may take longer. Our goal is always to sell as quickly as possible for the best price.

What can I do to make my home more appealing to buyers?

Simple improvements like decluttering, staging, fresh paint, and minor repairs can make a big difference. We’ll provide personalized recommendations based on your property.