At Delancey Street, we offer creative financing for you to get your dream property built. You can build in Nashville, Memphis, Knoxville, or anywhere else in the state. When you know more about the loan options, it’s easier to make the right financial decision for your business.
The Need for a Construction Loan in Tennessee
When you build a property, you have to look at all of the expenses. You’ll need to pay for land development, labor, materials, and more. The best thing to do is to establish a construction plan. This will vary based on whether you’re renovating an existing property or building from the ground up.
Once you know the costs, you can seek out a construction loan in Tennessee. It will give you the money that you need to get started. It could be tens of thousands (or even millions) of dollars. Various lenders will work with you to get the money that you need.
Construction Loans vs. Commercial Mortgages
There are some big differences between construction loans and commercial mortgages. Traditional lenders (like a bank) will offer a commercial mortgage. They’ll have you jump through hoops in order to get approved. The entire amount will be provided at the beginning as a lump sum. From there, you may be able to finance over a 10-year period.
New construction loans in Tennessee are going to be a bit different. You draw a schedule of funds based on the various steps. For example, some money may be released when the land is being developed. Then, more money will be released when the foundation is poured. You will only pay interest on the money that has actually been released to you. In the end, when your project is complete, you can pay in full or finance over time. If you choose a repayment schedule, your new building will be the collateral that is necessary to secure your loan terms.
Obtaining a Loan for Your Project
When you start exploring the Tennessee new construction loans, you have to pay attention to what the lender is going to offer you.
First, expect to pay a down payment. This can vary between 10 and 30% in most instances. It ensures that you’re willing to put your money in for the project, too.
Second, you will need to understand some of the fees that may have to be paid, including project review, documentation, and processing fees.
Finally, you will need to look at the interest rate being given to you. Much of this is based on the lender as well as the credit score of your business.
Since every lender has different terms, you will want to do your research. It will ensure that you get the best possible deal that is available for your construction project.
At Delancey Street, we can help. Contact us today to learn how you can get the financing needed for your construction or renovation project.