|LA Construction Loan
City Capital Realty offering new commercial construction loans for developer, builder and investor in southeren california | We are committed to working with you to find the perfect solution to deliver a creative structure and flexible terms
Call us Today! 310-714-5616
City Capital Realty
2355 Westwood Blvd Suite 258 Los Angeles
Commercial Construction Loans
New Commercial Construction Loan
You Can Borrow Up to 100% Of The Total Project Cost
Southern California Only
Loan Amount: $1,000,000 min
New Underwriting Guidelines
Max Loan to future value of 60%.
Borrower’s financial resources and experience play important role.
1. Does the borrower shows enough income on his personal tax return to continue to support his existing obligation in addition to new commitment during short-term process of this transaction?
Banks needs to know more information about land acquisition and future development projects.
1. Where is the property located?
Bank’s underwriter will do quick analysis of borrower’s financial and ability to perform.
At present financial market lenders have a formula that they apply for construction loan. Usually 40% equity is required in order to be qualified for a loan request for construction project.
How lenders and Financial Institutions calculate equity in the Construction Project?
If you purchased a land for $2,000,000 and construction cost will cost another $2,000,000 so the total construction project cost would be $4,000,000 you need to put 50% of your money as down payment that will be $2,000,000 and you can borrow the balance of $2,000,000 in order to finish the project. In today’s financial market this is the rule of thumb which most of the lenders are requesting.
If you intend to purchase a land that doesn’t have plan and permit, basically you temporary want to apply for land loan only. Some lenders are willing to extend a loan up to 50% of total price for a short-term period. So on this case you need to come up with $2,000,000 of your money as a down payment.
The interest rate for land loan is based on prime rate plus a margin and term will be between two to five years period.
Usually, when you apply for construction loan, you don’t have to make any monthly mortgage payments. In the initial cost breakdown that you are submitting to the lender, the interest reserve, insurance, property tax, closing cost, Escrow, title, appraisal, Phase I report, permit fee, architectural design fee and actual building cost (which includes hard + soft cost) is included.
Most lenders may require a Phase I environmental report or geological report to make sure that the land isn’t contaminated and dirt is strong enough.
Pay attention to lenders requirements and pre-requisites.
1. Condominium Projects
"Real Estate Broker - CA Bureau of Real Estate".
CAL BRE. 00667328 NMLS 298861 / 729817
Terms and condition are subject to change without notice. Some restrictions may apply.
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