A Land Loan tends to be one of the first types of building construction loans that can be required for a development or construction project.

This can be a bare land loan or land loans for semi developed properties that perhaps already have services and road access in place. If these services still need to be put in place, a separate site development loan may also need to be acquired for the project

Because the loan is real estate based and will be secured by a land mortgage, there are more likely to be options available for financing.

Like most anything else associated with land, the key to securing land financing is all about location.

A property that is located within a developed or semi developed area is going to be more appealing to a mortgage lender than one in the middle of nowhere with nothing going on around it.

There can be quite a range in terms of what amount of financing you can get on any given property, but in most cases, the lender’s interest will fall between 40% and 60% of the fair market value.

One of the potential benefits of trying to acquire a land loan is that your may have a full complement of mortgage lending choices right from bank and institutional lenders to private mortgage lenders.

Banks are going to be more focused on the cash flow generated by the applicant and their credit standing while private lenders are going to focus more on the fair value of the property and how difficult it may be to market in the event of a loan default.

Even if you can qualify for a bank land loan, you may still opt for a private mortgage as the requirements for financing and the length of time required to complete the application process can be substantially less than through a conventional lender. This can be a big issue when you’ve got an accepted offer to purchase, subject to financing and time is running out on the financing condition.

Higher loan to values are potentially possible, provide the property is pretty much at the construction stage or is in a highly active construction area.

In order to best determine what land loan options are available to you for any given piece of property, I recommend that you work with an experienced mortgage broker who has access to both private and bank land financing sources as well as a track record of successful placement.

Click Here To Speak With Construction Mortgage Broker Joe Walsh

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

Milton land loan financing can be arranged for most types of real estate properties where there is no permanent structures erected. The only real difference between a land loan and a commercial property mortgage per say is that a commercial mortgage has buildings attached to the land. And while there is a broader spectrum of commercial mortgage providers, the number of lenders and lending programs for just land financing is much smaller. This is largely due to the fact that bare land or partially developed land may have a very slow resale market, especially in less developed areas. As a result, mortgage lenders, on average, are less interested in land loans.

The good news is that there are both bank and private mortgage options for bare land loans and developed land loans.

The keys to qualifying for this type of financing is going to be a clean environmental assessment, a recently completed appraisal by an accredited appraiser in most cases, and the ability to service the debt and retire the loan in the future.

With respect to environmental issues, there still can be land loan financing options, but they are going to come from private lenders only and the rates and fees related to these type of land mortgages will likely be considerably higher than properties with a clean environmental report.

For bare land loans, 50% loan to value is very common among land lenders. If the property in question is immediately adjacent to a development or is in the process of being developed, the loan to value could increase to as high as 75%.

Banks and institutional lenders will be more focused on the credit profile and personal net worth of the borrower and/or business, while private mortgage lenders will be more focused on the exit strategy to repay the Milton land loan as private lenders mostly provide one year interest terms only.

In many cases, private lenders are utilized to either get a deal closed and then provide time for a lower cost land financing option to be arranged via a longer term bank mortgage or a take out mortgage after the development and construction are completed.

If you need a Milton land loan for bare land or semi developed property, I recommend that you give me a call so I can quickly assess your situation and provide land loan financing options for your immediate consideration.

Click Here To Speak With Construction Mortgage Broker Joe Walsh

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

“We Provide Aurora Land Loans and Land Mortgage Financing Facilities”

An Aurora land loan or bare land mortgage can be acquired through our network of institutional lenders and private lenders.

With bare land, the keys to the available financing amount that you can expect to secure include location, current use, expected future use, zoning, and so on. The more removed a piece of property is from future development in terms of time and location, the less loan to value. For instance, a bare piece of property in the middle of no where will likely not provide a mortgage amount greater than 50% of the property value. This relates to a likely slow resell time period in the event of default and foreclosure. Properties that are in a more active market area and/or will soon be developed to increase value will provide a higher lending value as a percentage of market value to the lender’s view that resale will be faster if required, and overall risk of loss will be lower.

For bank or institutional lenders to consider providing an aurora land loan, you will also be able to show a strong ability to debt service from existing cash flow. The cash flow available to the borrower can come from an unrelated source.

Private lenders are going to be less concerned on the historical proof of cash flow for debt service, although debt servicing is likely going to be required on a monthly basis.

The majority of Aurora bare land loans or land mortgages are provide by private lenders that have a good working knowledge of the local market and can take a hands on approach to loan and security assessment. Private lenders do have a higher cost of funds, but they tend to be interest only monthly payments with terms of one year in most cases. Private lenders can be excellent sources of short term financing, especially when you’re in a hurry and need to get something in place in a relatively short period of time.

Bank or institutional land loans will take longer to arrange so if you believe you can meet their requirements and want to take advantage of a lower cost of funds, then make sure you allow yourself plenty of time to go through the application and approval process.

If you require an Aurora land loan at this time, please give me a call so I can quickly assess your situation and provide relevant options for your immediate consideration.

Click Here To Speak With Construction Mortgage Broker Joe Walsh

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

“Burlington Land Loans For Developed Lots Or Bare Land Properties”

A Burlington land loan can be potentially be arranged on any real estate property where there is no building currently on the property. A bare land loan is either going to be required for a piece of property that has never been developed, or one where the use was or is agricultural where no development other than scheduled property management is required. Land loans for developed or semi developed properties can also be secured with the prospect that more financing can be acquired for these properties if the development work can increased the value compared to the bare land equivalent.

Land loans that are acquired for a use other than development of the property will typically fall in the 50% to fair value range for the potential amount of the land mortgage financing on purely bare land and higher ratios as you get into more developed real estate.

When the use of funds from land financing is to actually develop the property, then any increase in property value from the work invested can result in more funds that can be borrowed.

One of the key requirements for Burlington land mortgages is that there are no environmental issues on the property so the past use of the property will be important in determining if there may be any future concerns. When considering placing a mortgage on bare land, especially properties that have had an agricultural use, the environmental risk tends to be very low and not typically an issue. But when you get into situations where buildings have been removed from a property leaving a bare lot, the prior use of the building can have a considerable impact on any potential land financing opportunity.

Burlington land loans can be both from bank and private lending sources. Banks and institutional lenders are cash flow lenders, so even though the security value of the property may be significant, cash flow for repayment is going to be required for the lower cost sources of real estate property mortgage financing.

Private mortgages are going to be higher cost, but also more focused on property value and less on cash flow.

If you need a Burlington land loan, I suggest that you give me a call so I can assess your requirements and provide land mortgage financing options for your review.

Click Here To Speak With Toronto Mortgage Broker Joe Walsh

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

“Hamilton Land Loans Are Available For Bare Land and Developed Real Estate Properties”

A Hamilton Land Loan for acquisition of bare land or for performing property improvements can be secured from both bank and private mortgage lenders. There can be very variations to this type of lending starting with the condition of the real estate and its location.

As a general rule, the more undeveloped and remote the property, the more likely that 1) there will not be a lot of land loan options available; and 2) any land financing that can be arranged will likely not exceed 50% of the current fair market value of the property. If a subject property is closer to, adjacent, or in the middle of an existing development, there is not only a higher likelihood of greater lender interest but also the potential for a higher lending value to be secured.

With developed property that is located in an active resale market for similar real estate, the lending value can reach upwards of 75% of the market value. This can hold for both bank and private mortgage lending options. Bank financing for bare land is going to be more accessible with higher net worth individuals with well established cash flow. That being said, institutional loans can be made on development properties where the cash flow for debt service will predominately come from the sale of developed lots. The more complete the process from entry to exit for the lender, the more likely that bank or institutional sources will be interested in a land loan or land development mortgage financing option.

For a Hamilton land loan from a private mortgage source, end of term exit strategy to repay the mortgage will be the most important aspect of the deal for the private lender after evaluation of the land for security purposes. Private mortgages are going to come at a higher cost of borrowing than a bank land mortgage, but in most cases they can also be put into place faster, providing funding in a more timely fashion which may be crucial for meeting a tight deadline.

If you require a Hamilton land loan or land development mortgage, I suggest that you give me a call so I can quickly go over your scenario and provide relevant land loan financing options for your immediate consideration.

Click Here To Speak With Construction Mortgage Broker Joe Walsh

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

“Ontario Land Loan Financing Options Available For Different Real Estate Applications”

Ontario land loan financing options are available for many different types of real estate property and financing applications.

Real estate is a preferred asset to finance due to the permanence and stability of the security, so if a piece of land has an established market value and their is an active resale market for the property, then there is a good chance that an Ontario land loan can be arranged.

Location and condition will also play a significant role in the interest a given piece of property is going to attract from mortgage lenders that provide land financing commitments. The more remote and undeveloped the property, the less interest there is likely to be in providing a land loan.

But even if the property is bare land where no development has ever taken place, if the location is strategic in terms of near term future development, then the property is still likely to garner interest from property mortgage lenders.

For bare land mortgages, the basic starting point for financing is that both interested institutional and private mortgage lenders will consider financing 50% of the fair market value of the property. For a higher loan to value amount to be secured, the property is going to have to be closer to a residential or commercial use where additional property value or income can be realized.

For an institutional or bank land loan in Ontario, the borrower is going to have to demonstrate strong repayment ability towards the debt servicing requirements. Private mortgage lenders will still be interested in debt service, but because their mortgage terms tend to be no more than one year on average, proof of debt servicing is less of an issue, especially when only 50% of the property value is being financed via mortgage.

Financing rates for private mortgages provided for Ontario land loans are going to be higher than institutional rates, but they will also have much lower financing criteria to meet that what you will require to cover off with a bank.

If you require an Ontario land loan, I recommend that you give me a call so I can quickly go over your requirements and provider you with relevant land financing options for your immediate review and consideration.

Click Here To Speak With Ontario Mortgage Broker Joe Walsh

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

“Toronto Land Loans Are Available on both Bare Land and Developed Sites”

Toronto Land Loans can be secured for a large number of different applications that can relate directly or indirectly to the actual site location.

The great thing about a piece of real estate is that is always going to be easier to borrow against it compared to other forms of assets. For land financing, even if its bare land, both banks and private mortgage lenders can be interested in providing mortgage financing.

The one main key with land financing either in a bare land or some amount of development state is the property location and the potential marketability of the properly now and in the future. Mortgage lenders are always looking for exit strategies before extending financing, so if the property is in an active market where values and resale time periods are fairly predictable, then there is likely going to be land loan financing options to choose from.

The second thing to remember about Toronto land loans is that most mortgage lenders will not go above 50% of the fair market value of the property for any mortgage they are prepared to advance. Even in fairly active market areas, a bare piece of property or a semi developed piece of land is still going to be harder to move for a predictable price and in a fairly predictable time compared to an income producing or income supporting property.

A Toronto land loan can be secured for a number of purposes and the underlying real estate can also be used as security for a loan facility involving other piece of real estate or other assets.

Land financing under 50% loan to value can be a great source of bridge financing as the risk to the lender will likely be fairly low allowing a lending decision to be made fairly quickly with funds being advanced shortly there after.

If the borrower has a solid credit profile, a Toronto land loan can be secured through a bank or institutional lender provided that there is an established source of debt service available to cover the monthly payments.

If you’d like to learn more about locating and securing a Toronto land loan, I suggest that you give me a call and we can go over your requirements together and discuss relevant land loan options that meet your requirements.

Click Here To Speak With Construction Mortgage Broker Joe Walsh

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

“How to Secure Bare Land Loans against undeveloped property”

If you’re trying to get a land development project either off the ground or refinanced, then you may be looking to acquire a bare land loan against the subject property.

From a construction financing point of view, bare land will be looked upon by the lender in terms of its current market value and its current use classification.

For instance, if you’re looking to purchase a tract of agricultural land for development, if at the time of purchase the land is zoned for agricultural use, then the market value will be established from area sales of similar property. Because the land is zoned agricultural, the loan to value provided by a lender is likely going to be around 50% of the market value or purchase price, whichever is lower. If the land is sitting right up against developed property and development potential is easily established by the lender, the loan to value may increase.

As the builder or developer goes through the process of rezoning the land for residential or commercial use, the value of the land will go up to reflect the change in future potential use. If the market for the change in use is viewed to be strong, the loan to value is also likely going to increase.

For property that is already purchased for development that needs to be refinanced, one of the key things that mortgage lenders will look at is if the initial purchase was an arms length transaction to establish value versus the owner of the property buying it through a related company or separate entity. An arms length transaction will better reflect the market than a purchase within arms length.

Once value and marketability is determined on the subject property, the next step for the lender is to get comfortable with the exit strategy to repay the builder/developer mortgage at the end of the proposed term. A well thought out and supported exit strategy will go a long way to securing the financing you’re looking for as most property lenders are less interested in having to take back security on bare land in the event of default versus developed land.

While institutional lenders can provide bare land loans, over 90% of these types of property mortgages are provided by private lenders who are more prepared to finance on the equity in the property, provided that a solid exit strategy for mortgage repayment exists.

Click Here To Speak With Mortgage Broker Joe Walsh

The post Bare Land Loans For Builders and Developers first appeared on Ontario Construction Loans And Mortgage Financing.