Our client came to us with a specific problem. Having recently purchased a parcel of vacant land in Florida, our client was eager to get started on the construction phase to build a single-family home.
However, as a new general contractor with zero projects under his belt, he was getting denied by lenders across the country due to his lack of experience.
We were able to get him a construction loan, despite his lack of experience, with these favorable terms:
- 90% loan-to-cost;
- Flexible draw schedule to meet his timing requirements;
- Interest only charged on draws (another lender would have charged interest from Day 1);
- Loan term of 9 months (7 months to build and obtain a certificate of occupancy, and 2 months to sell);
- Option to obtain 2 extensions (1 month each); and
- Minimal cash required to close (less than $8,000).
He successfully executed his exit strategy by selling the property above the appraised value. We plan to help him with other spec home projects in the near future.
Everyone has to start somewhere. Even if you haven’t done a ground-up construction project yet, there are still loan programs available to you. Read our blog article, “Construction Loans for First-Time Builders of Spec Homes” and also check out our detailed guide to residential construction loans.
To see if we can help you obtain a construction loan — whether to build a spec home to flip, or to build your own home of your dreams — contact us today.
