All You Need to Know About Acquisition and Development Loans
Ensuring constant business growth is the mantra of every firm. The acquisition of raw land or the construction of new offices and warehouses is considered significant growth for a company. However, new projects require business capital to be conducted efficiently. These funds can be obtained through acquisition and development loans.
Here’s all that you need to know about them.
What Is an Acquisition and Development Loan?
An acquisition and development loan (AD) is a loan that is used to purchase land and construct a commercial property. A hard money acquisition and development loan is provided by private money lenders who use the value of your commercial property to deliver the loan. The loan is generally divided into two parts. One portion of the loan is used to buy raw lands, and the other part to construct the property. An AD loan offers a shortcut to grow your firm by providing quick financing. Moreover, the acquisition and development of new property can increase your firm’s revenue immediately.
Private money lenders can use several factors to determine the provision of the loan:
- The availability of additional collateral from the borrower.
- The value of the raw land being bought.
- Borrowers’ construction plans.
Types Of Loans
An AD loan can fuel your firm’s growth prospects. The AD loan has mainly two types:
Hard Money Raw Land Loans
If you’re looking to purchase raw land to start your growth project from scratch, a hard money raw land loan from a private money lender is an excellent option. You can’t rely on banks for providing loans for raw lands as they’re skeptical about the prospects of an unconstructed land.
Hard Money Construction Loans
Construction is a major part of any growth plan. If you want your newly constructed property to create an impression, you should hire the best contractors in town. However, hiring the best doesn’t come cheap. If you want to finance a reputed contractor, it’s better to opt for hard money construction loans to ensure you don’t run out of money midway through the project.
Get Construction and Raw Land Loans in Atlanta, GA Today
If you’re looking to acquire new land or develop an office, visit Commercial Private Equity now. We provide construction and raw land loans for our clients at competitive rates. We have been working in the private money lending industry for over seventy-five years and have gathered millions of profits for our clients. We strive to make the loan application process simple and streamlined to make loan acquisition easy. We provide loan programs and specialized hard money loans, including commercial hard money, bridge loans, and workout loans.
Contact us now for more details.
