Site readiness
Clarify land control, surveys, access, utilities, engineering and permit status.
BUSINESS-PURPOSE REAL ESTATE FINANCING · NEW CONSTRUCTION
A vision on paper.
A plan for delivery.
Discuss capital needs for a business-purpose ground-up project with the site, approvals, builder and budget considered together.
THE RIGHT STARTING POINT
A property.
A purpose. A plan.
Florida and other-state inquiries are reviewed individually. Submission does not establish eligibility or approval.
Builder alignment
Identify the builder, contract structure, qualifications, insurance and responsibilities.
Construction controls
Discuss the total budget, equity, reserves, draw administration and the completed-property exit.
THE FINANCING FRAMEWORK
Know the
starting parameters.
10–12%Annual borrower interest
24Month initial term · interest-only
50%Maximum of construction costs
2–6%Origination fee
Construction financing is limited to 50% of approved construction costs. For example, an approved $600,000 construction budget supports up to $300,000 in construction funding. Land-only financing is limited to 50% of land value. Land equity treatment, the combined financing structure and any staged disbursements must be agreed with the capital source after review of the plans, builder, budget, permits and valuation. These percentages are not added together to calculate an overall loan-to-value limit. Indicative parameters only. Final terms depend on the property, valuation basis, capital source, underwriting and documents. Loans are interest-only with an initial 24-month term. The outstanding principal is due as a balloon payment at maturity. Borrowers may reduce principal or repay the loan in full at any time without a prepayment penalty. In rare and extenuating circumstances, a loan review may take place 60 days before maturity to consider a potential extension of 12 to 24 additional months. Borrower payment history is part of that review. Any extension requires approval and a written agreement; a review does not guarantee an extension.
Explore an interest-only illustration →MAKE THE FIRST REVIEW COUNT
Bring the facts
into focus.
Begin with what you know. Identify estimates and unresolved items clearly. Supporting files can be requested after the initial review.
Open the borrower checklist →- Site address, ownership or land contract and survey
- Plans, specifications, engineering and approval status
- Builder information and construction agreement or estimate
- Total development budget, contingency and cash contribution
- Construction schedule and proposed sale or refinance
COMMON QUESTIONS
Understand
the details.
Can you consider a second-position mortgage?
Financing generally requires a first-position mortgage lien. Second-position financing may be considered after reviewing the existing first mortgage, available equity and overall transaction, subject to approval. Existing loan terms, total debt secured by the property, valuation and title must be reviewed. Availability and final terms are subject to capital-source approval and documentation.
Do permits need to be approved before the first conversation?
You can discuss a project before final permits. Clearly identify which approvals are complete and which remain outstanding; final funding conditions depend on the transaction.
Are construction draws automatic?
No. Inspections, draw approvals, release timing and responsibility for cost overruns must be agreed for the particular project.
Can I use my own builder?
Provide the proposed builder’s information for review. Acceptance and qualification requirements depend on the capital source and project.