Please help me analyze this Construction Financing Deal

[Sophia Berry]

Hello all,

I am new to the Construction deals and for some reason this deal does not sit well with me. I am okay with the points and interest payments, However the cash to close is having me scratch my head. I am paying for the Land, soft cost and horizontal costs from my own money so where does the cash to close come from. The LOC should be at 60% of the Vertical Cost and not the total . If I am only borrowing $136,800, why or who is getting the $43,200.

Someone please help me  wrap my head around this. (see below)

	Land	$16,000		Paid w/ Cash
	Horizontal	$20,000		Paying w/ Cash
	Soft	$12,000		Paying w/ Cash
	Vertical	$180,000
	TOTAL COST	$228,000
	ARV	$340,000
		Loan Amount
LTC	60%	$136,800
ARV	50%	$170,000
	Loan Amount	$136,800
	Cash to Close	$43,200
	Points	$2,736		- Pay closing costs and upfront fees at maturity of loan when you sell the property
Total Interest (6 Months)	$3,238		- No Interest Reserve and No monthly interest payments; pay Total Interest at maturity of loan when you sell the property.
				- Interest on Drawn balance (Interest is paid only on drawn funds)