Construction Loans: Flexible Financing for Property Development and New Builds
Customizable Loan Solutions for Real Estate Developers and Property Owners
Tailored Financing for Construction and Development Projects
Construction loans are designed to provide financing for property development, new construction, or significant renovations. These loans differ from traditional mortgages in that they are short-term and disbursed in stages as construction milestones are reached. They are typically used by developers, real estate investors, or business owners who are looking to build new properties or significantly improve existing ones.
At Lender Capital Group, we offer construction loan solutions that are tailored to meet the unique needs of developers and property owners. Whether you’re building a new commercial property, residential complex, or mixed-use development, our construction loans provide the capital and flexibility you need to successfully complete your project.
Service List
- Hard Money Loans
- Multifamily Property Loans
- FHA Loans
- Hospitality Industry Financing
- Office Building Mortgages
- Bridge Loans
- Industrial Property Loans
- Jumbo Loans
- VA Loans
- Commercial Real Estate Loans
- Construction Loans
- Special Purpose Property Loans
- Conventional Loans
- Residential Mortgage Loans
- Retail Property Loans
- HELOC
- Industrial Property Financing
Why Choose a Construction Loan?
Financing for Multifamily Customizable Financing
Construction loans can be tailored to meet the specific needs of your project, providing funding in stages as construction progresses. This flexibility allows you to manage your cash flow effectively during the build process.
Disbursement Based on Construction Milestones
Funds from construction loans are disbursed in stages, also known as “draws,” based on the completion of construction milestones. This ensures that the project stays on track and that funds are only used when needed.
Short-Term Financing for Construction
Construction loans are typically short-term, with repayment terms that last until the project is completed. Once construction is finished, the loan can be converted into a permanent mortgage or repaid through the sale of the property.
Higher Loan Amounts for Larger Projects
Construction loans can provide significant financing, making them ideal for large-scale developments, commercial properties, or multi-family residential projects.
Real Estate Development
Construction loans are commonly used for real estate development, making them a valuable tool for developers looking to build office buildings, shopping centers, residential communities, or other large projects.
Construction Loan Qualifications
To qualify for a construction loan, you’ll need to meet the following criteria:
Property Type
Construction loans can be used for a variety of property types, including residential, commercial, and mixed-use developments.
Loan-to-Cost Ratio (LTC)
Lenders typically offer construction loans with an LTC ratio of 70% to 80%, meaning they will loan up to 70% to 80% of the total project cost.
Credit Score
A minimum credit score of 680 is generally required, though higher scores may result in more favorable terms and interest rates.
Down Payment
Construction loans often require a down payment of 20% to 30%, depending on the size and scope of the project.
Experience in Construction
Lenders prefer borrowers with experience in construction or real estate development, as this reduces the risk associated with the loan.
Construction Loan Process: Step-by-Step
01.
Pre-Approval and Application
Begin by submitting an application for a construction loan. We’ll review your financials, including your credit score, income, and experience in construction or development. You’ll also need to provide detailed project plans, construction budgets, and timelines.
02.
Property Appraisal and Cost Verification
An appraisal will be conducted to assess the projected value of the completed property. We’ll also verify the total project costs, including construction, materials, labor, and contingencies, to ensure the loan amount aligns with the scope of the project.
03.
Loan Approval and Draw Schedule
Once your construction loan is approved, a draw schedule will be established based on the completion of key construction milestones. As each phase of the project is completed, funds will be disbursed in stages to cover the costs.
04.
Repayment and Project Completion
Construction loans are repaid once the project is completed, either by converting the loan into a permanent mortgage or through the sale of the property. In some cases, borrowers may refinance the construction loan into a long-term loan.
Benefits of Construction Loans with Lender Capital Group
- Tailored Loan Solutions: Our construction loans are customized to meet the specific needs of your project, ensuring you have the capital necessary to complete your development on time and on budget.
- Higher Loan Amounts: We provide construction loans that are designed for large-scale developments, offering significant financing for commercial properties, residential complexes, and mixed-use projects.
- Draw-Based Funding: We disburse funds based on construction milestones, allowing you to access capital as needed and ensuring that your project remains financially sound throughout the construction process.
- Experienced Lenders: Our team has extensive experience in construction financing and can guide you through the loan process, helping you secure the funding needed to bring your development project to life.
Don't Hesiate To Contact Us
Looking to finance a new construction or real estate development project? Contact Lender Capital Group today to learn more about our flexible construction loan options and get the funding you need to bring your project to life.