The construction loan is the easy part. The problem shows up 14 months later, when it has to be paid off.
Loans from $500K · Experienced builders · Takeout tested up front · Veteran-owned
Where construction deals break
Most builders structure the land and the build carefully, then assume the takeout will work itself out.
A 12-month build runs 16. The interest reserve is gone by month 13, so you carry three months of interest yourself while you wait on the certificate of occupancy. Then the completed value appraises short, and the refinance doesn’t cover the construction balance.
All of that was visible before the first draw.
The decisions I structure
- Land. Owned free and clear, financed, or under contract. Some capital sources will count land equity toward your contribution.
- Budget and contingency. Based on how your last build actually went, not how it was planned.
- Draws. Matched to your phases and the inspection process, so funding keeps pace with the work.
- Interest reserve. Whether it survives a 3 to 6 month delay.
- Takeout. A sale or permanent debt, tested at a higher rate than today’s.
The pattern I see most
Builders negotiate hard on the construction rate and barely look at the takeout. A quarter point on a 14-month loan is small money. A refinance that comes in $150K short of the payoff is the whole profit.
Who this is for
- Builders who have completed ground-up projects of similar size
- Loan amounts of $500K and up
- Project types: single-family through multifamily, plus office and other commercial buildings
- Properties in most of the U.S., through a nationwide network of capital sources
Not a fit: first ground-up projects, or builds without a realistic budget yet.
What I control
I’m not the lender. They set approval, loan-to-cost limits, and terms. I make sure the structure holds up from land to takeout before you commit to any of it.