I can help facilitate financing of construction projects for you if you are:
- A builder who owns a lot and is looking to build it on spec
- A land owner who wants to build a property to sell OR keep for personal use
- A builder who builds for end users and requires construction financing
- An investor who utilizes a builder to build on land you own OR have purchased to sell or keep for personal use
- A property owner who would like to utilize existing real estate equity to acquire and build another property
- A builder, end user or investor who is looking for a bridge loan to advance construction to the next stage OR complete construction
- A builder, end user or investor who wants to purchase a property and requires financing to build it
Loans: General Details
- This can be a 1st, 2nd, or 3rd mortgage. The rate is subject to change based on ranking.
- Up to 70% of the appraised end value, although this could be higher and is dealt with on a case by case basis.
- Draws can be advanced once 15% of the construction process is reached – this is known as backfill.
- There will be a 10% holdback on each draw.
- The lender, legal and broker fees will be deducted from the 1st advance.
- Starting from the second advance draws are subject to an inspection fee plus a legal fee.
- The loan will be advance based on the work in place.
- Interest will be charged on the funds advanced.
- Interest can be paid monthly OR deducted from each advance.
9 Steps to Securing a Construction Mortgage:
- We meet with you to assess your construction funding needs.
- Based on your needs, we put together a solution that fulfills the funding requirements. Details of the loan, payment structure and all expenditures relevant to obtaining the loan are discussed at this stage.
- You submit the required documents.
- We reconfirm the terms of the loan with you. Note that terms are subject to change if a discrepancy is found in the submitted documents. In some circumstances, we will require an appraisal report upfront.
- Commitment letter confirming all the previously discussed terms is issued.
- You sign the commitment. Based on the loan, a good faith deposit will be required by the lender.
- Appraisal is completed. This is paid by the borrower and if the value determined is lower than anticipated, the loan amount may decrease.
- You are required to obtain ILA (Independent Legal Advice) or ILR (Independent Legal Representation) based on the lender’s requirements. Final mortgage documents are signed.
- The signed mortgage documents are sent to the solicitor acting on behalf of the lender. Upon satisfactory review of the documents the first draw based on a pre-determined amount and closing date, will be funded.
It’s worth a call to schedule a free, no obligation review of your situation. Because the right mortgage can build your wealth and save you thousands of dollars! I look forward to helping you achieve your dreams for homeownership.