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