✅ Self-Build Prep Checklist for Alberta Contractors

May 16

If you’re a contractor planning to build your own home in Alberta, you already know the tools and trades — but the mortgage side? That’s where things can go sideways.

We’ve seen experienced builders underestimate costs, stall mid-project for financing, or miss big money-saving opportunities because they didn’t get the right strategy in place early.

Renee Huse, founder of Spire Mortgage Team in Calgary, Alberta, has helped contractors across Alberta build smarter, borrow better, and finish strong. This checklist is everything we walk our self-build clients through before the shovel hits the dirt.

1. Buy land like a lender would

You’re not just picking a lot — you’re making a financing decision. And trust us: not all land is mortgage-friendly.

Before you buy, make sure your lot:

Has access (an approach road or driveway — not just a vague easement)
Has or can support services (water, power, septic)
Is properly zoned for your planned build
Isn't flagged for flood risk or soil instability

Financing tip:
If you’re borrowing to buy land, expect to put 25–35% down, especially on raw or unserviced parcels. Some lenders won’t finance land at all. That’s where we come in — we’ll help you structure a land purchase that won’t stall your build later.

2. Nail your numbers early

Contractors are notorious for underestimating their own builds — especially if you’re doing the labour yourself. But mortgage lenders don’t care if you’re saving on trades — they still want realistic numbers and contingency built in.

Here’s what you need to include in your budget:

Lot purchase and servicing
Permits and inspections
Material and labour (include a fair wage for yourself)
Site insurance and builder’s risk
10–15% contingency

Get a full estimate breakdown together before applying for construction financing. We’ll review it with you and help position it for lender approval.

3. Choose the right financing model

Most Alberta contractor builds go one of three ways:

Draw Mortgage

This is the go-to for most self-builds and most custom homes. Funds are released in stages (draws) as the build progresses — usually 3 to 5 stages total. You’ll need appraisals and inspections to trigger each draw. These are done through AAA banks or private lenders, depending on the buyer’s credit profile and the project’s risk level.

If the finished value of your property will be under $1.5M, and you qualify, you may be eligible for a CMHC-insured draw mortgage with as little as 5–10% down.

Operating Lines of Credit

If you’re self-managing the build, you’ll want flexibility. We strongly recommend contractor clients secure a business operating line of credit through their business banker. It’s essential for covering short-term gaps in cash flow — especially between draws.

HELOC or Bridge Line

If you have equity in another property, you can sometimes access that via a home equity line of credit or bridge loan. It’s fast — but the interest rates are often higher, and the risk increases if you don’t convert it to a proper mortgage later.

Strategy matters here. We help our contractor clients build financing around their project plan — not the other way around.

4. Understand draw timing and build in flexibility

Each draw release takes time. Even with perfect paperwork, you’re usually waiting 5–10 business days after inspection and appraisal.

Here’s a typical draw schedule:

Foundation complete
Framing complete
Lock-up (doors/windows on)
Completion or occupancy

We help you align those stages with your budget — and just as importantly, we help you build in backup. Whether it’s a business line of credit, personal credit access, or short-term reserves, you’ll want something in place to bridge between draws.

This is one of the most overlooked parts of the process. Don’t let a timing gap put your project on hold.

5. Permits, insurance, and home warranty

As the general contractor on your own build, you’re responsible for:

Pulling the correct building permits
Following all local and provincial building codes
Carrying Builder’s Risk insurance
Ensuring all trades are WCB-covered and properly insured
Understanding your obligations under the New Home Buyer Protection Act

Yes — you may still need new home warranty coverage.
Even if you’re building for yourself, Alberta law requires most new homes to carry warranty coverage. In some specific cases, an owner-builder may apply for an exemption — but that’s not something we recommend skipping lightly.

We encourage all clients to visit the Alberta New Home Warranty website for the latest requirements and to understand their obligations. It’s your responsibility as a builder — and it protects you and your future equity.

Frequently Asked Questions

Can I build my own home as a contractor in Alberta?

Yes. Alberta allows contractors to self-build, provided you meet local permit, insurance, and code requirements. You may also need new home warranty coverage.

What is a draw mortgage and how does it work?

A draw mortgage releases funds in stages as the build progresses. Each stage is triggered by an inspection and/or appraisal to confirm project milestones.

Do I need a down payment for a contractor self-build?

Yes. Most self-builds require 20–25% down, but if your project is under $1.5M, you may qualify for CMHC-insured financing with as little as 5–10% down.

Can I use my business line of credit during a build?

Absolutely. Many contractor clients use operating lines to bridge between draws or cover up-front material costs. It’s a key part of smart build strategy.

Do I need new home warranty if I build for myself?

In most cases, yes. Alberta requires new home warranty coverage even for owner-builds. Some exemptions exist, but it’s not something to skip lightly.

Glossary: Self-Build Terms for Alberta Contractors

Draw Mortgage: A construction loan where funds are released in stages as the build progresses. Each draw is tied to an appraisal or inspection.
CMHC: Canada Mortgage and Housing Corporation. Offers mortgage insurance for qualified borrowers, including self-builds under $1.5M.
Operating Line of Credit: A business loan that provides flexible, revolving credit. Commonly used by contractors during construction to smooth cash flow.
Builder’s Risk Insurance: Protects your project during construction from theft, fire, vandalism, and weather damage.
Home Warranty: Alberta’s mandatory protection plan for most new homes. Covers structure, systems, and defects. Required under the New Home Buyer Protection Act.
Lock-Up Stage: The point in construction where the exterior is enclosed (roof, doors, windows), allowing interior work to proceed.
Zoning: Municipal regulations that control land use and building types. Must be verified before land purchase or permit applications.
Appraisal: A third-party valuation of your project at each draw stage. Determines how much the lender will release.

Bottom Line

If you’re a contractor planning a self-build in Alberta, here’s our best advice: get strategic early.

We’ll help you:

Secure land financing that won’t choke your build
Structure a draw mortgage that matches your cash flow
Leverage credit tools to stay on schedule
Protect your project with the right insurance and warranty coverage

Let’s talk before you break ground. The right prep makes all the difference.

Renee Huse