Construction Loans

Construction loans are short-term loans used to finance the building of a home or a large scale real estate project. This loan is used to cover the costs of a project before obtaining more permanent financing. Due to the risks inherent to lending on an unbuilt property, construction loans do come with higher rates than conventional mortgage products.

Private lending can help you to receive this kind of financing as they will look primarily at the value of the property and assets involved in the project. These kinds of loans are often interest only, this means the borrower is essentially renting the project until their more permanent financing solution is locked in.

Payments for construction loans often are paid out in tranches as project milestones are completed.