Construction Financing - 3 X SFH
i am looking for some advice on financing a project in the CA bay area.
we are building 3 SFH on a lot that will be subdivided.
based on a rather low appraised value of the completed homes, and lots and LOTS of city fees, power company fees, etc., etc., at a 65% LTV, we are still bunch short - basically we (i) would need to put in another $75 to $100k.
my first question is: how common is the 65% LTV ratio? after a few phone calls, it seems that most banks want to stick to this number. keep in mind this is not owner occupied financing at 90 or 95% LTV where LTV is the acquired cost.
has anyone done a project where the lender went to 70%? we are looking at 3 homes with a sales price around $1M each, and we need a loan around $1.9 or $2M.
one other angle, my partner will be moving into one of the units, to avoid a sh!tlo@d of city fees, realtor fees, etc and to try to build up 2 years for $250k gain exclusion. one thought was to try to get owner financing, but it makes getting funding for the whole project a lot messier. we are building all 3 at once.
any thoughts or ideas greatly appreciated.
65% ltv/ltc for construction seems like pretty little financing
i hear ya. thats what i thought too. but keep in mind it is 65% of the finished appraised value. so i guess that banks are much more conservative percentage-wise on a future value, rather then what is currently existing.