Construction Loans

Unlock the potential of your property with construction financing, designed to meet the needs of every project from start to finish. Enjoy competitive rates and expert guidance as you develop real estate or expand your business infrastructure.

Apply Today

Book A Call

Solutions

Legacy Guard loan brokers provide tailored construction loan financing solutions that set the foundation for success. With an emphasis on competitive rates and personalized service, these loans cover every phase of the construction process. Whether you’re developing a commercial space or enhancing your residential property, Legacy Guard ensures your project is well-funded and promptly supported, driving your venture forward with confidence and expertise.

Construction Lending

Construction loans are financial instruments designed to fund building projects from inception to completion. Unlike traditional loans, construction loans are typically short-term, with funding available only until the construction is fully completed. Throughout the project, funds are dispensed in phases or “draws,” which correspond to the completion of predetermined milestones within the construction timeline. This phased approach ensures that the borrower has the necessary funds to progress without bearing the burden of a lump sum at the outset.

Additionally, the vetting of contractors plays a critical role in the construction lending process. Before approval, lenders often require a comprehensive review of the contractor’s qualifications, reputation, and past project performance to ensure they are reliable and capable of executing the project effectively. This rigorous assessment helps mitigate risks and assures lenders that the project will be completed to a satisfactory standard, safeguarding their investment.

Development Funding

Development funding supports the first stage in the successful execution of real estate projects, offering crucial financial resources that can be strategically allocated across various stages of development. These funds are essential for land acquisition, allowing developers to secure strategic locations that align with their project goals. Moreover, development funding extends to cover permitting costs, ensuring that all legal and regulatory requirements are met before construction begins. This helps streamline the project timeline by addressing potential hurdles early on. Another critical application of development funding includes infrastructure development, which lays the groundwork for essential services such as roads, utilities, and drainage systems, thereby enhancing the property’s value and viability.

Additionally, development funding supports the preparation phase, which involves site clearing and grading activities necessary to make the land construction-ready. By providing comprehensive financial support, development funding ensures that each project phase progresses smoothly, setting the foundation for successful project completion.

Redevelopment Loans

Redevelopment loans provide a lifeline for properties that have seen better days, transforming them into revitalized assets with renewed purpose. These loans cater to the reinvigoration of existing structures, facilitating extensive renovations or conversions to elevate a property’s status, such as changing its building class to improve the property and claim higher rents from tenants. This process not only enhances the aesthetic and functional aspects of a property but also significantly increases its market value and appeal.

Redevelopment loans cover various expenses, including structural upgrades, improvement of utilities, and modernization of interiors, ensuring that the property meets contemporary standards of living or commercial use. By breathing new life into old or underperforming properties, redevelopment loans play a critical role in urban renewal and economic regeneration. They enable investors and developers to unlock a property’s full potential, attracting new businesses or residents and revitalizing communities.

Financing Triple Net Lease Building Construction

Financing triple net lease (NNN) buildings can be an attractive option for investors seeking stable, long-term returns. In a triple net lease, tenants are responsible for covering taxes, insurance, and maintenance costs, which reduces the landlord’s operational responsibilities and risks. Lenders offering financing for NNN properties often consider these leases as favorable due to the steady cash flow generated by reliable tenants and minimal landlord expenses. Ideal properties include well-located retail spaces, office buildings, and industrial facilities with creditworthy tenants. Financing options may range from traditional mortgages to customized loan products, allowing investors to leverage capital effectively for significant growth and diversification.

Financing Multifamily Housing

Financing multifamily housing presents a valuable opportunity for investors looking to maximize returns while addressing housing demands. These properties, which include apartment complexes and duplexes, offer diversified income streams that reduce risk through multiple tenant occupancy. Various financing options are available, including Federal Housing Administration (FHA) loans, Fannie Mae and Freddie Mac programs, and conventional bank loans.

These options often provide lower interest rates, longer terms, and higher leverage, making them appealing for both novice and seasoned investors. Additionally, multifamily properties benefit from economies of scale, as the cost of maintenance and management can be distributed across many units, enhancing profitability.

Financing the Development of Hotels and Resorts

Financing the development of hospitality properties such as hotels and resorts requires a tailored approach that considers the unique challenges and opportunities in this sector. Various financing options are available for developers, including traditional bank loans, commercial mortgage-backed securities (CMBS), and joint ventures. These methods cater to both large-scale luxury resorts and boutique hotels. Investors often look at factors such as location, market demand, and projected revenue to ensure returns are maximized. Government incentives and subsidies may also play a role, supporting developments that enhance regional tourism. A sound financing strategy is essential for achieving long-term success in this competitive industry.

Advantages

Construction loans offer several benefits for developers looking to bring their building projects to life. Here are some key advantages:

N

Flexibility in Use: These loans can cover a wide range of costs, including land purchase, materials, and labor, tailoring to specific project needs.

N

Interest-Only Payments: During the construction phase, borrowers often can pay only the interest, which helps manage cash flow efficiently.

N

Structured Funding: Funds are released in stages as construction progresses, ensuring that the project stays on track and within budget.

N

Potential for High Loan Amounts: Construction loans can provide higher-than-average financing percentages, accommodating substantial projects.

N

Conversion to Permanent Loan: Upon project completion, many construction loans offer a seamless transition to a permanent mortgage, simplifying the financing process.

FAQ

DONT DELETE THIS

Your content goes here. Edit or remove this text inline or in the module Content settings. You can also style every aspect of this content in the module Design settings and even apply custom CSS to this text in the module Advanced settings.

Is construction financing the same as permanent financing?

Construction financing is not the same as permanent financing. Construction loans are short-term, interest-only loans designed to fund the building phase of a development project. Once construction is completed, these loans often convert into permanent financing, which becomes a long-term mortgage with a repayment plan covering both principal and interest.

What if you've been turned down for construction financing before?

If you have been turned down for construction financing, it’s important to understand the reasons behind the denial. Review your credit history and financial documentation for potential issues. Consult our brokers for opportunities to strengthen your application. We will help you explore alternative lenders or financing options to help you fund your project.

What should I do if my contractor is not accepted by the lender?

If your contractor is not accepted by your lender, you may need to evaluate other contractors who meet the lender’s criteria. It’s crucial to communicate with your lender to understand their requirements for contractors, which may include specific licensing, experience, or insurance levels. Additionally, working closely with a trusted real estate agent or builder can help you select a suitable and acceptable contractor.

What variables should I consider in taking a construction loan?

When considering a construction loan, several variables should be taken into account. These include the interest rates, loan terms, and repayment options offered by potential lenders. Evaluate the loan-to-value (LTV) ratio and the down payment required. Additionally, assess the lender’s flexibility regarding cash flow management and how funds will be disbursed during the project. Lastly, ensure that the loan conditions align with your overall financial goals and project timeline.

Start now

Schedule a free call and get your questions answered by an expert today.

Contact Us

We support clients coast-to-coast

Start Your Financial Journey

Legacy Guard is your partner in the financing journey. We build and retain relationships in the evolving financial markets to help businesses close deals, no matter the complexity of the financing or business plan.

This model allows us to explore numerous capital structuring options for your project while locking in the best possible terms and rates with fast turn times, minimal out-of-pocket expenses, or impact on personal credit.

Apply Today