I Have 2 Lots For SFH... Guidance Needed
Hi everyone,
I am taking over 2 projects for my father that he doesn't have time to supervise. We have 2 lots right now, one is in Los Angeles, CA and the other in San Bernardino, CA. We are General Contractors so I am not worried about the construction aspect of the homes, but i'd like some guidance as to completing the projects without using our own money. Although I have current money available, I'd like to use it as leverage rather than actual financing. At what stage of the process can I apply for a construction loan, and which is the best way to do this? Both homes are on the final stages of getting the plans approved. Thank you.
If you are about to get plans approved you need to get to the bank right now. I usually try and finance my homes prior to submitting for permits so that I can pay for all the soft costs of designs, etc. via financing. Typical construction loan will do a 100% payoff on the value of the land and then finance 80% LTV on the actual construction cost.
Many thanks,
What will the lender typicall require to see in order to finance a project. I already own the lots, and we are a licensed GC. Any suggestions as to how to go about this? Thanks again!
Call Hawthorn Saving. They do construction loans.
If you're interested in another lender I have working w/ one in s. cal. That's quite liberal. The key w/ them, is these aren't spec homes.
Indy mac is another.
They want to see approved or atleast submitted plans, a construction budget and contingency funds, credit approval, etc.
Quote:
On 2004-05-24 22:49, woodsong wrote:
If you are about to get plans approved you need to get to the bank right now. I usually try and finance my homes prior to submitting for permits so that I can pay for all the soft costs of designs, etc. via financing.
Woodsong, how is it that you are able to finance your soft costs, I was under the impression that soft cost were usually paid "out of pocket", I am still sort of trying to grasp the various avenues of what gets financed and at what point.
If you were not going to "build out" the lots yourself, but instead were only going to subdivide a large parcel for individual re-sale to builders and other developers could the soft costs associated with the subdivision process be financed?
Thanks-[ Edited by wmwealth on Date 05/31/2004 ]
Hi CJ
I would definitely be interested in the lender your working with in SoCal. Please let me know. Thanks!
wmwealth,
A friend of mine, a temporary professional secretary that was 4 months out of work(!), got financing for a $228k property and another $15k for soft costs to cut off 3 blocks.
Her mortgage broker worked 2 months putting that deal together for her.
So, that must be available!
I also attended an intro for www.ubuildit.com and that was very helpful, you might want to go to one in your area. Those guys know the local lenders who do construction loans and their specialties.