We arrange land servicing loans to our customers in Toronto, the Greater Toronto Area, and Southern Ontario.

Land or lot servicing financing is typically available to developments once they have gotten to plan approval stage with the local planning authority.

There are a number of keys to locating and securing a site development loan.

One of the first criteria of a lender providing land servicing loans is the track record and reputation of the developer in terms of their professional resume and list of successful projects completed. A lack of historical success can greatly reduce the amount of leverage that can be available for any given project.

Directly connected to the first criteria is the financial track record of the developer as well. Its not uncommon that lenders will not consider an application from a developer who has had one or more bankruptcies in the past from failed projects. The distinction here is there is a big difference between a project that was not all that successful and one where those providing financing lost money.

Next on many lenders’ criteria list is the number of presales that have been completed to the point of application and projected to be completed at the point that funds are required. The presales form the foundation of the exit strategy for land servicing loan repayment so the amount and strength of the agreements is going to be important for financing.

Lenders are also going to be interested in who the project engineers are and level of work that has been completed to the point of application. Just like other third party service providers such as appraisers, lawyers, and accountants, lenders can also have a list of approved project engineers that are comfortable with as well as a list of project engineers they won’t work with.

The last, but hardly least area of initial focus by a lender providing land servicing mortgages is the location of the development and the projected absorption rate of the lots that come available from the development work to be performed. The lender is going to be interested in the amount of inventory that exists in that local market, historical proof of annual absorption, and the amount of market share the development is expecting to have versus other developments in the area.

Proactively putting all this information together with a construction mortgage broker can go a long ways to not only locating the financing you’re looking for, but getting the funding in place by the time its required.

Click Here To Speak With Ontario Construction Mortgage Broker Joe Walsh For A Free Assessment Of Your Land Servicing Loan Options

The post Land Servicing Loans first appeared on Ontario Construction Loans And Mortgage Financing.

A construction site development loan can have very different requirements from one project to another.

For some projects a site development loan is the first step of multi phase financing that will be required to complete the project.

Each phase typically will require a distinctly different loan with specific draw requirements and an assessment of fair market value at each step of project completion.

For other projects, the property owner or developer is only performing site development work and will sell off landscaped and serviced lots to other builders and developers.

In the latter case, the actual site development for a large project can have multiple phases and can run for a number of years.

When this is the case, its going to be important to clearly identify the period of time funds are going to be required and exactly how the cash flow from the sale of units is going to be handled with the lender.

For instance, during the site development of a given phase or stage of the project, will the borrower or property owner be able to service debt on a monthly basis or will cost of capital need to be capitalized into the lot?

When site developed lots are sold, what is the borrower’s expectation as to how much of the proceeds will need to be applied to the outstanding balance versus retained by the borrower?

And when multiple site development phases are involved, does the borrower have a well laid out and defined cash flow that shows the flow of money coming in and out to the lender during the construction period?

Each site development project, especially for larger projects with multiple phases, will require a customized site development loan facility that meets the unique requirements of the project.

Therefore, its going to be key to make sure that the borrower / lender match is appropriate so that the project can advance as expected without having any cash flow issues during any of the work to be performed.

This is where the expertise of an experienced construction mortgage broker comes in to not only get the borrower focused in on the most relevant sources of site development financing quickly, but to also help make sure that the terms and conditions of funding are going to meet the requirements of the project and project owner(s).

Click Here To Speak Directly To Construction Mortgage Broker Joe Walsh For A Free Assessment Of Your Site Development Loan Financing Options

The post Length And Structure Of Site Development Loan first appeared on Ontario Construction Loans And Mortgage Financing.

“We Provide Kitchener Land Development Loans Through Our Bank and Private Lending Sources”

A Kitchener land development loan can be for a small project under $50,000, or for work that will require millions of dollars invested in property and site development. Most of the time these type of construction loans are financed by way of a mortgage registered against the property where the work is being done. In some cases, additional property may also be pledged as security in order to provide the equity portion that a certain lender will require in order to advance the amount of funds required.

Land development loans or mortgages are provided through both banks and private mortgage lenders. While each case is somewhat unique, one of the main lending criteria that separates an institutional or bank loan from a private mortgage is the strength of the repayment profile of the borrower. While private mortgage lenders are also concerned with repayment, their primary focus in on the market value of the property before and after the site development work is completed as well as the exit strategy that will eventually repay the mortgage being advanced.

Typically, a site development mortgage can be arranged from between 50% to 75% of the value of the property. With structured work and construction draws at key project completion points, the value added to the property from the work as completed can also increase the property value considered for the mortgage which can result in a larger loan being extended over the life of the work schedule, provided that the work is completed in accordance to what was planned out at the start of the mortgage application.

While institutional land development loans will come at a lower cost of borrowing, they will also take longer to take in place and likely have a more stringent draw management process to deal with. In order to take advantage of bank financing for a given Kitchener land development loan requirement, its important to understand the terms and conditions of bank financing before applying so that enough time and effort can be factored into the application process.

If you need a Kitchener land development loan, I suggest that you give me a call so I can quickly assess your requirements and help you get aligned with the most relevant mortgage lending program as soon as possible in order to keep your overall planning process on track.

Click Here To Speak With Construction Mortgage Broker Joe Walsh

The post Kitchener Land Development Loan first appeared on Ontario Construction Loans And Mortgage Financing.

“We Provide Markham Land And Property Development Financing For Residential And Commercial Projects”

Markham Land development loans are available to real estate developers, professional builders, and property owners in both Markham and the surrounding Great Toronto Area.

A land or property development mortgage can be secured for any work that will be invested in a property. The more the specific work will increase the value of the underlying property, the larger the potential loan amount as a percentage of the property’s fair market value, estimated at the completion of the work, or at the completion of each stage of work.

The second element of land financing interest among both institutional and private mortgage lenders is the potential to sell the property at the completion of the work in order to pay back the mortgage balance. The more defined the exit or mortgage repayment strategy, the more likely property development financing will be available. For instance, pre sold lots of a development where significant deposits have been paid would be a very sold repayment plan and one that could not only attract an institutional lender but also high loan to value ratios for the mortgage being secured.

The other key ingredient for bank or institutional land development loans is the ability to show how the monthly interest costs will be serviced during the time the mortgage is outstanding. Conventional lenders will be much more focused on this aspect of a project compared to a private lender who may even consider holding back on some of the mortgage proceeds to cover future interest costs if the exit strategy at the end is strong enough.

A Markham property development mortgage can be for a wide range of financing amounts starting at a low of $20,000 and working into several million dollars for larger projects.

One way that larger development projects can effectively fund the property development work is to complete the project in phases where at the completion of each phase, the development financing can be repaid and then essentially reused for the next phase until the end is reached.

If you need to secure a Markham land or property development mortgage for a project you’re planning right now or one you’re currently in the middle of, I suggest you give me a call so I can go through your requirements and provide land development financing options for your consideration.

Click Here To Speak With Construction Mortgage Broker Joe Walsh

The post Markham Land Development Loan first appeared on Ontario Construction Loans And Mortgage Financing.

“Brampton Property Development Loans Are Available For Single Lot Construction Projects As Well As Larger Developments”

A Brampton property development loan can be required for any type of activity that improves the value of the property. This definition would typically exclude a construction loan for building construction and focuses more on the costs that get invested in improving a bare land piece of land, up to the start of building any structures.

Real estate property development financing can come from both bank and private mortgage lending sources. The related financing will almost always be secured by a real estate mortgage on the property and/or another unrelated property offered as security.

When the property development work is substantial in nature, the mortgage lender may require a post work appraisal and a draw schedule when key segments of work are completed that will increase the value of the property. In this way, more funding can be made available to the project provided that there is a progressive value increase as money is being spent.

Brampton property development loans typically will be issued from 50% to 75% of the fair market value of the property being offered up as security in either the existing or future state, depending on the project and the lender program being accessed. To get to the higher loan to value amounts, the property must reside in an active market with potential presales already in place for lots that will be sold off once the development work is completed.

For institutional property development mortgages, presold lots or property units may be required to secure this type of financing. Alternatively, the borrower will have to provide a strong personal or business covenant in addition to the mortgage security to attract the cheaper forms of financing.

More typically, Brampton property development loans are provided by private mortgage lenders that have a focus on real estate development financing which allows them to more quickly assess the risk and understand what actions to take in the event of a borrower default which could include taking over the development if necessary.

If you’re in need of a Brampton property development loan or mortgage, one of the best approaches is to work with an experienced mortgage broker who has access to both institutional and private mortgage lending sources that provide this type of construction real estate financing in the local market area.

Click Here To Speak With Construction Mortgage Broker Joe Walsh

The post Brampton Property Development Loan first appeared on Ontario Construction Loans And Mortgage Financing.

“Ontario Land Development Loans Are Available For Various Stages of Real Estate Development Projects”

Ontario land development loans are provided through both institutional and private mortgage sources, although the majority of development work will likely be financed through private lenders.

Land development financing can be required by a builder, developer, or property owner looking to improve the condition of a property and/or add infrastructure to the property to promote future use.

For larger real estate development projects, the development work is typically completed in phases of similar size. A land development loan is acquired to fund the costs of a single phase and once the phase is complete and sold off, the land loan is paid down and the funds remain available for the next phase of construction.

For the earlier phases of development, there is more land available for security, but the market value may be low due to the still unrealized potential of the development. With the completion of each phase, there will be less land available for security for the next phase, but the land value will likely increase as lots are sold and houses are built and put into use.

Even when a builder purchases a series of semi developed lots with roads and utilities installed, the builder may also require a land development loan for landscaping and other site preparation requirements that need to be completed before building can commence.

Because of the speculative nature of land development projects, its harder to get institutional financing in place unless there is considerable equity in the project and there are a significant number of pre sold lots already in hand prior to the advancement of an Ontario land development loan.

Private mortgage lenders that get involved in land development loans tend to be individuals who specialize to some degree in similar development projects and are more than prepared to take the project over in the event of loan default by the developer or property owner borrowing the money. This is one of the key reasons why land development loans are mostly private as the risk of loss is more easily managed by individuals that specialize in this type of land financing.

If you need an Ontario land development loan, I recommend that you give me a call so we can review your requirements together and discuss relevant land development financing options that meet your needs.

Click Here To Speak With Ontario Construction Mortgage Broker Joe Walsh

The post Land Development Loan first appeared on Ontario Construction Loans And Mortgage Financing.

“We Provide Land Development Mortgage Loan Financing in Toronto And Other Parts of Southwestern Ontario”

Depending on the property and development project, there can be considerable variability in land development mortgage financing in terms of the lenders interested in a given project, and the rates and terms you can hope to secure.

When financing land development costs, the first things the construction mortgage lender will consider is the current market value of the property, the activity level of the surrounding market for similar development, and the projected market value that can be expected once the proposed work is completed.

For a bare land property with nothing developed in its immediate vicinity, the loan to property value ratio is going to be lower than a similar bare land property that is surrounded by in process or completed commercial or residential construction projects.

For bank or institutional lenders, the property value has to be matched with a strong repayment assessment from outside sources as the property under development will not be able to cash flow monthly debt service requirements.

For private mortgage lenders, the focus is more on the before and after value of the land and expected time to market the property in the event of foreclosure.

For larger projects where completed work will be sold as one unit or many, pre sales of the end product can further add to the amount of land development financing that can be secured.

Also important to all commercial lenders will be the exit strategy that is planned to repay the development financing loan when the work is completed. In many cases, this could be done through a refinancing action that will provide incremental funds for the next stage of the project, through an equity injection potentially from new investors in the project, or through the sale of lots to other builders or developers that are looking to purchase prepared sites.

Because there can be considerable differences in what can be secured for land development financing from one source to another, your best approach would be to work with a construction mortgage broker that has access to both bank and private mortgage providers in your area. That way you will have all your options covered and can quickly focus on the most relevant mortgage lenders for your land development mortgage financing requirements.

Click Here To Speak With Toronto Construction Mortgage Broker Joe Walsh

The post Land Development Financing first appeared on Ontario Construction Loans And Mortgage Financing.

“Key Considerations For Toronto Property Development Financing”

Toronto property development financing may be required for a construction project where the existing  land needs to be prepared in some fashion to allow the building construction to commence.

As a general rule, all phases of a construction project can be financed, provided that 1) there is sufficient equity in the project to support the loan, and 2) that the expected market value of the property is going to increase at the conclusion of each phase of work.

In this sense, Toronto property development financing is no different. Builders and developers have to make sure that they maintain a certain amount of equity in the project to attract the capital they require at any given point of time. And equity really only comes from two places…its either invested in the project by the owners or created within the project through work that is completed that has a market value.

For many developers, a property development loan can be a good source of financing to move the project along to the next step where more investors are going to be coming in, providing a further equity stimulus to attract a construction loan for the building phase.

For other property owners, developers, and builders, Toronto property development financing will be the last construction mortgage loan they will require for all or part of the project. Especially with larger projects, its not uncommon for a developer to sell off part of the development, after site infrastructure has been installed, to other builders or developers. This provides the injection of capital to the project to fund the next phase of construction.

Toronto property development financing will come in a mortgage registered in either a first or second position. If the land being developed is free and clear of encumbrances, the equity may be sufficient to secure a construction mortgage for the amount of the development costs. Once again, the higher the marketability of the land and the proposed land after development is completed, the higher the loan to market value ratio will be when trying to secure a property development mortgage.

For assistance locating and securing Toronto property development financing, I suggest that you give me a call so we can go through your requirements and discuss relevant property development mortgage options that are likely going to be available to you.

Click Here To Speak To Toronto Construction Mortgage Broker Joe Walsh

The post Property Development Financing first appeared on Ontario Construction Loans And Mortgage Financing.

“There Are a Number of Ways To Arrange Site Development Mortgage Financing For Your Construction Project”

If you’ve got a project that is going to require site development mortgage financing for the next stage of development, here are some different strategies to consider.

Keep in mind that construction financing in many cases is funded by the building phase with potentially several different construction mortgages being in place and getting paid out from different lenders during the life of the project.

This is due to the fact that each stage of the project comes with different risks and different security re-marketing challenges in the event of lender foreclosure, so lenders that will finance the actual building construction may or may not have any interest in site development.

The key to any mortgage financing is the property or properties offered for security and the exit strategy for repaying the construction loan in the future.

The simplest form of site development mortgage financing is to place a first or second mortgage on a bare land piece of property that is just at the beginning of the development stage. If the property is zoned and permitted properly for the intended use and the overall project is well planned out with sources of capital available for the next stage, then a site development mortgage can be secured for from 50% to 75% of the value of the property, depending on location and type of project.

If there is insufficient equity in the property at the present time, then a secondary piece of property can be pledged as security. The property can be completely unrelated, but will likely need to be in a strong resale market to make it easier to attract interest. Depending on the amount required and location, lenders can take residential and commercial properties as additional security as well.

In situations where site development is partially complete and the builder or developer has invested significant funds to improve the property, the appraised value of the as is development can also be used to secure site development mortgage financing. The further the project is along, the more lender interest that will be available and the higher the loan to value construction mortgage lenders will consider.

If the construction project has resale units that have been pre-sold and is in the process of securing bank or institutional construction mortgage financing for the build out, a conventional lender may also consider providing a land advance to complete the site development if there is enough equity in the property.

This is likely going to be the cheapest form of site development mortgage financing as you’re leveraging the building phase construction application to get better rates for site development work.

If you have a construction project that requires site development mortgage financing, I suggest you give me a call and I will quickly assess your requirements and provide relevant construction mortgage financing options for discussion and review.

Click Here To Speak With Toronto Based Construction Mortgage Broker Joe Walsh

The post Site Development Mortgage Financing first appeared on Ontario Construction Loans And Mortgage Financing.