Vaughan Land development loans are many times the second financing requirement for a construction project after the land acquisition financing. Land development financing is typically secured by either a first or second mortgage against the property being developed, depending on whether or not any previous mortgages are registered against the property. The use of funds for land development can range from land surface improvements to installation of road ways and service infrastructure.
When a mortgage lender looks at financing land development work, they will consider the value of the property before and after the completion of work when determining the amount of financing that can be provided. Like building construction, a land development mortgage or loan may require more than one construction draw where the work requirements will be specifically outlined and be required to be completed before funds will be advanced.
Property development work can be performed by land developers that are looking to get land within their development serviced to a point where they can resell the lots to property owners or builders that will further construct buildings on the lots acquired. This type of financing can also be provided on a smaller scale to a builder or property owner that is doing property improvements to a smaller number of lots.
While both institutional and private mortgage financing can be available for a given project, the majority of Vaughan land development mortgage financing is provided by private mortgage lending sources. Typically these are individuals, syndicates, or mortgage investment corporations that have a specialty in this type of financing and are prepared to take over the development in the event of mortgage default. For institutional lenders to consider these types of construction loan financing opportunities, a high percentage of the lots that will be sold at the end of the development work need to be presold with contracts signed and deposits provided by the prospective buyers.
If you require A Vaughan land development loan, or are in the planning stages of your project, I suggest that you give me a call so we can go over your requirements together and review different land development financing options that will meet your needs. As a construction mortgage broker, I have access to both bank and private mortgage sources that provide land development loans.
Click Here To Speak Directly To Construction Mortgage Broker Joe Walsh