The construction industry is one of the most booming industries in the US. It has a contribution of 4.3% in the GDP and has over seven million employees. The main reason why the construction industry has flourished is the favorable economic conditions for investors and ease of financing.
Construction loans are given out by not only banks but private lenders too. Private hard money lenders give out construction loans by taking your property as collateral. However, construction loans can only be acquired if you apply properly.
Here are four things you need to have to successfully apply for a construction loan.
The Construction Plan
A clear and efficient construction plan will facilitate private lenders to give you construction loans. You must provide the hard money lender with all the details of the construction plan. The relation between you and the lender can be strengthened if your construction plan is transparent.
Who Is Constructing the Property?
Constructing your property through a qualified builder can boost your chances of acquiring a construction loan. The higher the integrity of your contractor, the better the chances are of the project finishing on time. When private hard money lenders provide you with a construction loan, they trust you to ensure that the project completes on time to avoid repayment issues.
Estimated Value of The Constructed Property
Many construction loan decisions are based on the value of the property after the construction. You must hire a licensed appraiser to get an estimated value of your property. Many private money lenders use the appraised value to decide loan terms, so the higher the value of your property, the better terms you will receive.
The down payment is usually 20-30% of the total loan amount, but if you’re taking a construction loan from a private hard money lender, down payments are forgone as you provide your property as collateral.
Acquire Construction Loans Now
If you’re looking to construct your property, you may need to get the finances for it. Visit Commercial Private Equity now to get construction loans. We have worked in this industry as a construction loan lender for over 75 years. We also provide other specialized loans, including workout loans, raw land loans, commercial hard money, and bridge loans.
Reach out to us now to obtain construction loans for interest rates as low as 10%.