Construction Loans

A construction loan is specifically designed to finance the construction or renovation of a property. Unlike traditional mortgage financing, which is based on the value of an existing property, a construction loan is based on the projected value of the completed project.

Lenders typically consider factors such as the borrower's creditworthiness, the project's feasibility and profitability, the borrower's experience and track record, the project's timeline and budget, and the value of the collateral.

While limited experience may pose some challenges, it is still possible to secure a construction loan. Our attorneys can help you navigate this process by leveraging our industry relationships, crafting a strong loan application, and demonstrating your commitment to the project's success.

Construction loan disbursements are typically managed through a process called "draw requests." The lender releases funds at specific stages of the construction project, usually after verifying the completion of predetermined milestones or inspections.

Common challenges and risks include cost overruns, construction delays, unforeseen issues during the construction process, changes in market conditions, and potential disputes with contractors or suppliers. Having an experienced attorney by your side can help mitigate these risks and protect your interests.

Construction loan funds are typically designated for the construction or renovation of a specific project. While some flexibility may exist, it is important to clarify the terms and restrictions with your lender. We can review the loan agreement and provide guidance on the permissible uses of funds.

Our real estate attorneys have in-depth knowledge of construction loan agreements and can negotiate terms that align with your best interests. We can review loan documents, negotiate interest rates, repayment terms, and ensure that the contract protects your rights throughout the loan term.

Delays and cost overruns are common challenges in construction projects. Our attorneys can help you address these issues by reviewing your contracts, assessing liability, and pursuing legal remedies if necessary. We work to protect your investment and keep your project on track.

Yes, there are alternative financing options such as mezzanine financing, bridge loans, or joint ventures that may be suitable for certain construction projects. Our attorneys can assess your project's unique circumstances and recommend the most appropriate financing options for you.

The repayment period for a construction loan varies depending on the project's scope and the terms negotiated with the lender. Repayment can occur through various methods, including converting the construction loan into a traditional mortgage or refinancing the loan after the project's completion.