Whether you’re planning to build a single or multiple family home, a ground up construction loan can help you secure the financing needed to create your dream home. Ground up construction loans offer short term financing that cover the cost of construction. They can even help with the purchase of property.
If you would like to discuss ground up construction loan options with a qualified broker, the team at POM (Peace of Mind) Capital & Funding Services have the knowledge and experience to guide you through every step of the process.
Is a Ground Up Construction Loan Right for You?
Ground up construction loans are a way to secure streamlined financing for a building project. Unlike a traditional mortgage, ground up construction loans are short-term. Getting approved can be a quick process, which is ideal if you’re eyeing property that won’t be on the market long and need to act fast. This type of loan is designed for those who are:
- Experienced builders needing quick financing
- Contractors with shovel ready land who needs financing to begin a build
- Owners of a property that needs extensive renovations
If you fall into any of these categories, a ground up construction loan is made for you. You can close quickly, often in as little as a couple weeks, so this is your best option over a traditional mortgage.
What To Ask Your Broker
Since ground up construction loans are based on potential risks regarding the project, there is often little documentation required to secure financing. During your consultation, a few important questions to ask are:
- What percent of construction funds can be borrowed?
- What details should I include in my project plan?
- What documentation is required for each construction draw?
- What fees should I expect?
- Are there any extension fees or penalties for extending financing?
- What support is offered during the course of my project?
Construction projects do not always go according to the predicted timeline established when securing a loan. Delays acquiring materials or weather preventing construction can set back your project. Be sure to discuss any potential extension penalties that could accrue due to unforeseen circumstances. Additionally, be sure to include expected closing costs into your budget. If you are considering potentially turning the completed project into a rental property, discuss this as changes to your plan later could alter your agreement with your lender.
We Can Help
At POM Capital & Funding Services, we can schedule a consultation to learn more about your options and what to expect when investing in a ground up construction loan. Coming prepared with the right financial documents and project expectations will help your broker become familiar with your circumstances to get you the best loan possible.
If you would like to discuss your ground up construction loan options with an experienced broker, call POM Capital & Funding Services at (631) 354-9290 or write to us at [email protected] to schedule a free consultation with our team.
POM Capital & Funding Services is a leading provider of alternative funding solutions for businesses of all types and sizes, offering commercial finance solutions and products to businesses in the Centerport, New York area and throughout the state of New York.