Why Partner With a Seasoned Construction Lender?
Alleviate risks associated with construction loans by partnering with an experienced lender.
Construction projects can be risky to venture into, however, having a knowledgeable loan officer and lender who understands the complications and provides a meticulous review of the loan and disbursement process can alleviate some of the risks and ensure a smooth end to end process.
In order for a lender to qualify a contractor, they must look at an abundance of data, such as the contractor’s references, financials, plans, specs, budget, and previously completed projects, in order to prove that the contractor can complete the project. The extensive analysis performed by the lender is necessary considering the risk that they will take on when funding a construction project.
Ensuring that the lender undergoes a thorough process is vital for all parties involved (investor, project manager, general contractor, sub-contractors, inspectors, and loan administration companies). Once the lender’s underwriter completes the loan analysis and approves the contractor for a loan, the builder is then able to close the loan, and begin construction. Most construction loans work off of a reimbursement schedule, meaning, once the work is complete, and evidenced by an inspection, the lender will reimburse the builder for cost incurred. The initial draw can reimburse the builder for costs spent in preparing the lot and making it shovel ready. There is a lot more to ensuring a seamless construction loan, but finding a reliable, and experienced construction lender will simplify the process and is a good place to start.
CALCAP Lending offers ground up construction, and renovation for residential business purpose loans, with a focus on 1 to 10 units, exceptions allowed on a case by case basis.
