How to get a Construction Loan
Title of Presentation
How to get a Construction Loan
1. Identify the property that you are interested with. You may:
Write an offerAlready have the property (you
already own it or a partner owns it)
2. Get the financing so you can build your house or apartmentsOur company usually get involved
right around when:the plans are done
you have submitted them you’re going to get all your permits and you’re going to get what we call
shovel ready
How to get a Construction Loan
The difference is that sometimes we help and we’ll do an acquisition loan
We do acquisition type loans that lead into a construction loan.
Those type of deals we structure them first as the purchase money deal and then we’ll usually do a second deed of trust, which is the construction money. But that’s after the plans get approved through the city.
Are the requirements more stringent, less stringent with a construction loan?
Difference is, there’s hard money construction loans, there’s regular construction loans through a bank
Spec - means a contractor, and investor is basically building on speculation, they’re building to sell for a profit
Through Bank:
In the spec world , these types of loans are very difficult in the market right
now to get funded by any banks. Banks are starting, finally, to loosen up and
lend a little bit more in the construction world, but it’s still very difficult
Through Hard Money:
we’re not so driven on having a 750 credit score and fully document everything; ,
we do require tax returns and bank statements and a credit report—but we look
at the overall project. we put more weight on the project as
opposed to the individual
Through Hard Money:
overall, it’s more like, we underwrite almost like a commercial property. Where the property needs to really be able to take care
of itself we also do a future value appraisal
based on the plans of the property. And we’ll go up to 65% of the future value
Beau Eckstein
Direct: 925.852.8261
Managing Partner
SFR Ventures Inc.
BRE #01307829
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