A & D Land Loans - Non-Recourse Bank FinanceLoan Amount: $5 Million and up
Term: Up to 3 Years Rate: Prime+0.5 or SOFR Origination Fees: 1.5-2.0 PT Loan To Value/Loan to Cost: Up to 60% Non-Recourse; 65-70% Non-Recourse with corporate guarantee; 75% Full-Recourse Recourse: Non-Recourse with Completion Guarantees Facility Options: Prefer to set up facility for multiple transactions Build for Rent Options: Now available for ADC Finance for both townhouses and single family homes Comment: Non-recourse land loans are more common with private funds, but much rarer for bank finance. We can look at individual project finance or a facility to accommodate A, D & C, all at bank rates. Furthermore, a facility can include finance for build-for-rent projects, in addition to single family for sale homes. Non-Recourse Land Loans - Quick Close ScenariosLTC vs LTV: 60% of entire builder takedown which may be up to 85% LTC!!
Loan Amount: $2M - $30M Term: 1 to 2 Years Rate: 11% and up Origination Fees: 3pts Appraisal: Not Required Recourse: Often Non-Recourse Closing Time: Typically 3 to 4 weeks Comment: Ideal for transactions of $2M-$7M; quick closes A & D Land Loans- Non-Recourse Private FinanceLoan Amount: $2M - $40M+
Term: Up to 5 Years Rate: 10.5% and up Origination Fees: 2-3% Loan To Value/Loan to Cost: Up to 75% Recourse: Non-Recourse Comment: Lot developers use high LTC non-recourse A & D land loans, in combination with their builder deposits to close with little to none of their own cash at closing. With the majority of the capital stack financed, developers can close without an equity partner, and keep 100% of their profit. OBS* Landbanking - Up to 85%Investment Amount: $2M – $10M of Peak Investment Per Project
Builder Deposit: 15% of Acquisition & Development Cost Term: 12 - 42 Months Option Fee Rate: 11% and up Personal Guarantee: Non-Recourse Builder Contract: Option Contract - No Specific Performance Minimum Term: No Minimum Term, Builder may buy early without penalty. Investor Minimum Return: No Minimum Return or Interest or Multiple Comment: Builders and large developers use OBS to minimize equity requirements. There are no minimum returns, multiple requirements, or hidden fees and builders can buy lots back early with no penalty. BTR - Non-Recourse A, D, & C (Vertical) - up to 75% LTCLoan Amount: $8M - $50M for A, D, & C
Term: Up to 3 Years Rate: 10% and up Origination Points: 2-3% LTC: Up to 75% Recourse: Non-Recourse w/ completion, standard carve-outs Comment: Best to use our program for land acquisition, site development, and vertical. Then refi or sell at occupancy / lease up when the buildings are complete. ****Other Asset Classes
Land Finance Group strives to provide the gamut of land loans, often characterized by risk. We also entertain other risk-based loans, such as "covered land plays", mixed-use projects, resorts, and brownfields. |