After helping our client close his first construction loan ever, we obtained another construction loan for him to build his second spec home, also in Stuart, Florida.
The borrower, a general contractor himself, was able to qualify for 85% loan-to-cost. Because he had one construction project under his belt, we were able to obtain a lower interest rate for him this time around.
He also benefited from the following loan features:
- Flexible draw schedule to meet his timing requirements;
- Interest only charged on draws (another lender would have charged interest from Day 1);
- Streamlined loan term of 6 months;
- Option to obtain 2 extensions (1 month each); and
- Minimal cash required to close.
Our client did not need to exercise the extension option. He was able to construct and sell the property within 6 months of closing. And, he was able to sell the finished product at a higher price than the appraised value.
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.
