Best Self-Construction Financing in Saudi Arabia
19-08-2025
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! Building your dream home is now easier with Bank Albilad
Now construct your dream home by availing quick and easy to apply self-building financing by Bank Albilad.
In cooperation with the Real Estate Development Fund and the Ministry of Housing, Bank Albilad offers you self-build construction loan. So, the wait is over! We give you the opportunity to build your desired property by 4 financing payments throughout the construction phases.
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What are the differentiating features of the self-build financing?
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Terms and Conditions
- Open current account with Bank Albilad
- Customer must be 18 years or older
- Customer must be an employee of a public or private sector approved by Bank Albilad.
- Customer's salary should be 3,000
 or more - Customer should be 70 years or younger when making the last payment
- Real estate must be located within urban area
- Available only to REDF and MOH customers
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Required Documents
Customer Documents - Valid ID
- ID copy for military employees
- A letter from the customer's employer indicating: monthly salary (Basic and allowances), job title, date of employment
- A statement of salary transfer from employer ( in case financed with salary transfer)
Real estate documents- Copy of the title deed
- Copy of building permits
- Sketch of property location
- Filling “property information” form
- Filling “financing” form
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FAQs
Is there any management fee? The management fee is 1% of the financing amount with cap of 5,000.
How the profit margin is calculated?Here is an example of how the profit margin is calculated:
| Self-build Financing | | | Real Estate value | 500,000 | | Finance amount | 90% of real estate value | | Type of profit margin (Fixed or Variable) | Fixed Rate | | APR | 6.70 % | Management fees
| Management fees is 1% of the Financing Amount with Cap. of 5,000 | | Finance duration | 25 years | Type of installments
| Funding principal and profit
| Finance Amount
| 450,000.00
| | Monthly installment | 3,093.75
| | Early settlement | The value of the remaining asset with an additional 3 months earnings
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Are there any administrative fees?Yes, the administrative fees are 1% of the financing amount, not exceeding 5,000
How is the financing amount calculated in the Self-Construction product?The customer is granted financing based on the credit limit, not exceeding 90% of the expected property value after completion (construction cost + land value).
Construction cost = (Average construction cost per square meter × building area)
How is the profit margin calculated?Through the declining balance mechanism, the annual profit is distributed based on the financing amount into monthly installments, calculated on the remaining principal balance.
Example 1 – Self-Construction Financing
Land area: 300 m²Land value: 200,000 Building area: 350 m²Average construction cost per m²: 2,000
Construction cost: 700,000 Property value after completion: 900,000 Financing-to-value ratio: 90%Financing amount: 810,000 Profit margin rate: FixedAnnual Percentage Rate (APR): 6.63%Financing term: 30 yearsInstallment type: Principal and profitMonthly installment: 5,044.5 Early settlement: Remaining principal amount + 3 additional months' profit
Disbursement mechanism:Installment | Installment Amount
| Percentage of Financing Value | 1 | 202,500 | 25% | 2 | 162,000 | 20% | 3 | 162,000 | 20% | 4 | 243,000 | 30% | 5 | 40,500 | 5%
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Example 2 – Self-Construction Financing
Land area: 250 m²Land value: 300,000 Building area: 300 m²Average construction cost per m²: 2,500 Construction cost: 625,000 Property value after completion: 925,000Financing-to-value ratio: 90%Financing amount: 832,500Profit margin rate: FixedAnnual Percentage Rate (APR): 6.63%Financing term: 30 yearsInstallment type: Principal and profitMonthly installment: 5,184.6
Early settlement: Remaining principal amount + 3 additional months' profit
Disbursement mechanism:Installment | Installment Amount
| Percentage of Financing Value | 1 | 208,125 | 25% | 2 | 166,500 | 20% | 3 | 166,500 | 20% | 4 | 249,750 | 30% | 5 | 41,625 | 5% |
Example 3 – Self-Construction Financing
Land area: 450 m²Land value: 500,000 Building area: 400 m²Average construction cost per m²: 2,400 Construction cost: 960,000 Property value after completion: 1,460,000 Financing-to-value ratio: 90%Financing amount: 1,314,000 Profit margin rate: FixedAnnual Percentage Rate (APR): 6.60%Financing term: 30 yearsInstallment type: Principal and profitMonthly installment: 8,183.3
Early settlement: Remaining principal amount + 3 additional months' profitDisbursement mechanism:
Installment | Installment Amount
| Percentage of Financing Value | 1 | 328,500 | 25% | 2 | 262,800 | 20% | 3 | 262,800
| 20% | 4 | 394,200 | 30% | 5 | 65,700 | 5%
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*Terms and conditions applyThe annual percentage rate varies based on the amount and maturity period and Subjected to the customer's credit history
Risk DisclaimerYou must review and be aware of the materials used in constructing the house and obtain their warranties, if any.
It is important for the customer to make payments on time, as the credit record will be negatively affected in case of delay or default in payment
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