I’m interested in purchasing land and building a house. Some initial inquiries into lenders yielded responses that were less than encouraging. It seems that construction loans went the way of the dodo bird when lending tightened. Does anyone have insight or recommendations in this area?
No recommendations, but insight says that you may be fighting an uphill battle. My knowledge is more on the commercial side, but it seems that the only deals going through right now are negative risk for the banks… at most 70%LTV with unencumbered collateral at least equal to the project value.
I would expect to put up collateral that could be easily liquidated by the bank, and valuable enough for the bank to be made whole should they end up with a half developed chunk of lizzardland on their books.
*disclaimer* No lizzards were injured in the drafting of this comment.
I work for a commercial bank that has an active custom home construction department with a variety of residential land, construction and construction to perm programs. Nothing that rolls into a 30Y fixed, but you can roll into a 10Y and its fixed from closing (ie: through the construction period).
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