When seeking construction financing for a development project, speed to money and the terms you’re looking for is going to start with providing as complete an information package as possible that is going to be relevant to the lenders you are applying to.
Incomplete applications will at best slow the process down and at worst get the application rejected as many lenders don’t have the time and patience to continually ask for the missing information that they require to make a decision in your favor.
While no two lenders are exactly the same in terms of what they want to see and how core information needs to be supported, here is a basic list of the information 80/20 you can expect to have to come up with in order to get anywhere with your construction financing request.
– Physical construction costs.
– Fees and permits (sewer, water hook up, lot levies, building permits etc.)
– Architect, legal and appraisal fees.
– Interest and brokerage fees.
– Sales and leasing commissions.
– Contingency & GST.
– Site supervision and overhead.
– Personal financial statement listing all assets and liabilities.
– Last 3 years business statements showing balance sheet and income and expenses if available.
– Credit report if available.
– Borrower history detailing experience.
– Confirmation of Borrowers equity.
Remember that the more complete the information package, the faster you’re going to get some serious traction with construction loan providers.
Also keep in mind that poorly assembled or thrown together application can speak (at least in a lender’s mind) as to the way you go about your business. While a well prepared application is not going to guarantee that you’re going to get financing from any particular lender, it helps get your project looked at considered versus easily dismissed due to poor presentation.