Financing a Land/Construction Loan

[Brad Lowery]

Hello all,

Me and two other partners are working on financing for a construction loan in Cantonment, FL (just north of Pensacola, FL). We would need to purchase the land and (if possible) bundle it into a construction loan. This would be a 3 bedroom 2 bathroom residential property that is currently appraising for around $265,000 with an all in land and construction cost of $210,000. So far, every lender we have spoken to is wanting proof of 2 examples of new construction investment properties in the last 36 months. This particular property we are looking to sell once completed. I am currently in the process of building two long term rental properties in Pensacola, but they are not sufficing because they are not yet complete. We are trying to understand what options we have to obtain financing and wondering if you had any thoughts. Any information would be greatly appreciated. Thanks!

[Issac San Miguel]

Hey Brad,

As a direct lender myself, like-for-like is huge in our world - and a big part of funding.  Especially with the rising rate environment and our end loan buyers getting tighter with their underwriting. 

When this is a challenge, we ultimately recommend adding someone to the project (by writing them onto the operating agreement) who has that paper experience.

I hope that this helped - let me know if you have any questions.