As the real estate market continues to surge, construction project funding requests are becoming more prevalent. With one of the hottest market areas, San Jose hard money construction loans are an area of focus for many of our funding sources and investors.
We are able to help with San Jose hard money construction loans, as well as hard money rehab loans in San Jose. From ground up, construction completion, remodels with added square footage all the way down to the cosmetic fixers, we can help put together funding for many projects in need of private money financing.
Our construction loans are pretty straight forward. We typically will cap out at 65% of the as complete value of the project, or 80% loan to cost (including the purchase price). There are some instances where we can put together funding at a more aggressive level if you are willing to work in an equity share type of situation. By the same token, if you need less leverage the terms will become softer the lower the leverage is.
Our hard money construction loans, as well as hard money rehab loans, are typically comprised of a few different parts. On every loan a fund control account is established for the work to be done. This fund control is managed, and funds are released as work progresses on the project. Depending on the scope of the project we may also include a contingency on top of the budget and/or any contingency requested by the borrower. The goal with the fund control account is to ensure there is enough money held to complete the project.
A second component is an interest reserve account. We will typically also set up an interest reserve account for monthly payments. These can range anywhere from 3-4 months on smaller projects or cosmetic rehab deals, up to 12 months or longer for ground up projects or larger deals. Again, the goal is to have the full project funded upfront, including debt service and funds for the work to be done. This allows our clients to focus on getting the project completed and sold in a timely manner rather than having to worry about raising additional funds to finish the project.
If you are in the market for San Jose hard money construction loans, rehab loans or construction completion loans, give us a call today at 877 462 3422 to discuss your scenario. You can also visit our main site for more information on our California hard money loans.
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