Straight Answers · Tiny homes

Can you get a home loan for a tiny home?

Q: Can you get a home loan for a tiny home?

Sometimes, and one line decides it. If the dwelling is permanently fixed to the land with services connected, it can be home loan territory. If it has an axle, a VIN or a registration, it is not a home loan at any lender, no matter how it looks inside. There are still ways to fund it, they are just different loans.

Bayley Clarke · Mortgage broker on the road · Last checked 17 August 2026 · 6 min read

The short answer

Sometimes, and one line decides it. If it is permanently fixed to the land with the services connected, it can be a home loan. If it has an axle, a VIN or a rego, it is not a home loan at any lender, no matter how good it looks inside.

That does not mean you cannot fund it. It means you are funding it with a different loan, and the order you do things in decides whether it works.

The wheels test

Every conversation about tiny homes ends up at the same fork, and most people do not find out which side they are on until weeks into it.

What a lender is actually looking at

Fixed to the landHome loan territoryBolted down, plumbed in, power and water connected, wheels gone.

Still on wheelsNot a home loanAxle, VIN or rego. To a lender that is a vehicle, not a house.

It has nothing to do with how nice it is. I have seen tiny homes with better joinery than most kitchens I walk into, and the lender still says no, because a bank securing a loan against something that can be towed away has no security at all.

Nine words for the same thing, and your bank means different ones

Kit home. Modular. Prefab. Transportable. Relocatable. Mobile. Container. Granny flat. Tiny home.

People use those interchangeably. Lenders absolutely do not. One bank files a kit home and a prefab under the same policy. The next one treats them as two different products with two different answers. A third does not use the word kit home anywhere in its policy, so if that is the word you searched, you get told it is not possible when it is.

This is the single biggest reason people get told no when the answer was yes. Not the deal. The vocabulary. Somebody asked the wrong bank the wrong word.

Broadly, across the lenders that will consider one at all, you are looking at a maximum somewhere in the sixty to eighty percent range of the value, and lenders mortgage insurance is generally not available. So the deposit needs to be real. There are a couple of lenders sitting above that range on a completed valuation if the build is done a specific way, which is exactly the kind of thing worth checking before you commit to anything.

The mistake that makes it unfundable before you start

Here is the one that catches good, capable people. You buy the flat pack. It gets delivered. You have got a mate who is a sparky, another who does plumbing, and you are handy enough to project manage the rest.

That is owner building. And owner building is generally unacceptable across every lender that will otherwise fund one of these. They want a licensed registered builder, a fixed price contract, and standard progress payments with inspections. The moment you become the builder, the construction loan disappears.

Two more that sit alongside it:

Progress payments are fewer than you think. A normal construction loan runs about five drawdowns. Prefab tends to run about three, and some of the money the builder wants is due before the thing is even on your land. You need real cash to bridge that gap.
Anything outside the contract, you pay for. The deck your mate is going to do, the extra tank, the bit you are getting done off the books. It does not go in the construction loan.

And before any of it, council. Approval to build is not the same as approval to live in it. Some councils cap how many days a year you can occupy one. I would want that answer in writing before you spend a dollar.

If it is on wheels, there is still a way

This is the part almost nobody gets told, and it is why "the bank said no" is usually the start of the conversation rather than the end of it.

A tiny home on an axle is not a home loan, but it is fundable. Depending on what you are doing with it, it can be a personal loan, asset finance if it carries a VIN and rego, caravan finance, or in some cases a business loan if you are building them out as short stay accommodation. There is at least one lender writing a purpose built tiny home product now, which did not exist a couple of years ago.

The two step, in order

1. Fund the tiny home itself on the right kind of loan and get it onto your land.

2. Take the wheels off. Fix it down. Get the water, power and waste connected properly.

3. Now it is a permanent dwelling, and now it can potentially be refinanced into the home loan, ideally with the valuation uplift the dwelling has added to the property.

Two things about that. It only works if the numbers stack at both ends, so it needs modelling before step one, not after. And one warning worth having: a lot of personal loan lenders will decline the application outright if you tell them the money is for a tiny home. That is not a reason to be vague on an application. It is a reason to be talking to someone who knows which lenders have an appetite before you start filling anything in.

What this page cannot tell you

I have deliberately not put a lender by lender table on this page, and I want to be straight about why. This is one of the fastest moving corners of lending policy there is. One major stopped doing kit homes entirely in the space of a year. Another brought out a tiny home product that did not exist before. A table published today is misinformation by Christmas, and people make decisions off tables.

Whether your specific build fits depends on what it is called in the contract, who is building it, and where it is being built. Those three answers change the lender.
Your council rules. They vary street to street, let alone state to state, and no broker can tell you what your council will allow.
Whether the rent counts. If you are putting one out the back to rent, some lenders will not count that income at all and some will only count it once it is built.

What I can do is work out which lenders have an appetite for your version of it, in the order that keeps your options open, before you sign a build contract that closes them.

Work out if yours is fundable before you commit

Half an hour, your actual plan, and I will tell you which of the paths above yours fits and what it needs to look like to work. If the honest answer is that the build you are describing cannot be funded the way you want it funded, I will tell you that too, and what would have to change.

Book a 30 minute call Call 0437 189 939

No application, no credit check, nothing on your file. Just the numbers.

Next question

Can I build a granny flat on my place and rent it out?

Same family of question, different answer. Whether the rent counts, and the one size rule that decides how easy the money is to get. Coming next in the series.