Need a Construction Loan?
When buying isn’t an option, build what you need instead with a construction loan. Construction loans let you develop land, erect buildings, and renovate existing properties.
Need a Construction Loan?
When buying isn’t an option, build what you need instead with a construction loan. Construction loans let you develop land, erect buildings, and renovate existing properties.
Loan Overview
Build it faster and build it better when you have the right financing. Construction loans help you keep your project on track so you can hit your target completion date.
There are many ways to fund construction, but a specialized construction loan is your best option. Instead of paying out a lump sum at the start of your project, a construction loan will pay in stages, depending on where you are in your timeline. Complete stage one to release funding for stage two, and so on. This process not only helps you keep your project moving smoothly, but guards against the unexpected. If severe weather, labor issues, or material shortages cut your project short, you’re only responsible for the part of the loan already paid out. That means you’re not on the hook for the complete cost of the project if something goes wrong.
To get approved for a construction loan, you’ll need to gather several documents. Prepare to show detailed construction plans, contractor information, materials lists, and an exit strategy, as well as financial documents. It’s important to know your Debt Service Coverage Ratio (DSCR) and debt-to-income (DTI) ratio before you apply. Need help? Speak to a broker today.
LAND DEVELOPMENT
Before it’s time to start building, raw land needs to be prepared first. Level and grade soil, install utilities, pave roads, and remove vegetation with a land development loan. You can also manage assessments, surveys, and inspections under the same loan. Launch your next building project with confidence, knowing you have a solid site prepared.
NEW REAL ESTATE
There’s no better way to ensure you have exactly what your business needs than to build from the ground up. Customize aspects like floor-to-ceiling windows, sustainable building materials, express elevators, and more when you fund your plans with a construction loan. If you have reliable contractors, detailed plans, and an exit strategy, apply now.
RENOVATIONS
If your retail space needs a facelift or your warehouse needs a new roof, take out a construction loan to make your renovations affordable. Construction loans will even fund “fix and flip” properties that you want to restore and resell. With many lenders to choose from, you can find exactly the loan you need.
ADVANTAGES
Pay only interest during construction.
A wide range of lender options is available.
Can be converted to a commercial mortgage.
Repay only a portion of the loan if something goes wrong.
DIS-ADVANTAGES
It’s rare to get 100% of the project covered.
Down payments of 10%-30% are required.
You may have to change contractors at the lender’s request.