Recently Funded | $350K – Construction Completion Bridge – Commercial Real Estate Loan, CT | $350
$350K CONSTRUCTION COMPLETION BRIDGE LOAN FOR CT REAL ESTATE INVESTOR
Second lien bridge financing allows an experienced developer to complete construction on a luxury single family property in Fairfield County, CT
An experienced real estate investor was mid-project on a luxury single family home renovation, but faced construction delays and cost overruns due to COVID.
In the face of this uncertainty, the bank lender was unlikely to increase the construction loan. Speritas Capital arranged a construction completion bridge loan, secured by a second mortgage (second lien) on the property, which closed in 10 days.
The Loan Need & Challenges
Due to covid-19 time delays and increased costs, project costs were higher than anticipated, and exceeded the financing available from the senior bank lender.
The borrower was reluctant to ask the bank for an increase because she was concerned that it would raise red flags and that the senior lender might not allow additional draws on the facility.
Speritas Recommends a 2nd Lien Construction Completion Bridge Loan
This experienced investor had worked with Speritas Capital on other deals so they came to us for help.
Speritas Capital knew that it would be difficult to find another lender to help complete this project. Most commercial real estate lenders do not provide construction completion financing when the project has experienced delays and overruns, no matter what the circumstances.
Refinancing the entire bank loan with a cash-out option would have been expensive for a construction completion loan. So we recommended a second lien bridge loan.
Read More about the Strategic Use of BRIDGE LOANS
Finding the Right 2nd Lien Construction Completion Bridge Lender
Speritas capital assessed the situation and determined that the second loan, combined with the first, would result in a relatively low combined loan-to-value ratio. This gave us confidence that we could find the right lender.
From our deep lender network, Speritas was able to bring a local alternative lender who would consider this specific type of scenario – an experienced investor and strong underlying market value. This lender knew the market well and had provided other second-lien loans.
About this Construction Completion Bridge Loan
2nd LIEN BRIDGE LOAN
LENDER: ALTERNATIVE NONBANK
CLOSED IN: 10 DAYS
Conclusion – Post Finance Update
Speed was of the essence for this investor so that this luxury development project could keep to the construction timeline.
This construction completion bridge loan closed in 10 days, allowing the investor to access capital quickly, complete construction, and get on the spring market.
The Speritas Capital team is always happy to hear your story, learn more about your financing needs and answer your questions. And we never take an up front fee. Contact Speritas Capital Partners today!
Jeff Bardos, CEO – MEET JEFF!
The Speritas team brings our 30+ years of banking experience and our transparent, strategic approach to every client and every deal, both large and small.