Ground-Up Construction · Business-purpose
Ground-Up Construction Financing for Investors and Builders
REI Capital Consulting LLC is not a direct lender. Financing is provided by independent third-party lenders. Programs are subject to lender underwriting and approval.
Who this fits
- Builders and investors with documented recent construction experience
- Spec homes and build-to-rent single-family or 2–4 unit projects
- Projects on purchased land or land you already own
- Plans and budget ready, with permits issued or in process
- A clear exit: sale on completion or refinance into a rental loan
Usually not a fit
- A home you plan to live in (owner-occupied)
- First-ever build with no experienced builder on the team
- Raw land that is not yet entitled or permitted for the planned build
- Projects in markets the referenced program excludes
How it works
How ground-up construction financing typically works
Land
The lender funds part of the land purchase, or counts equity in land you already own.
Budget review
A line-item construction budget and plans are reviewed and verified.
Draws
Construction funds are released in stages as completed work is inspected.
Exit
The loan is repaid by sale or refinance, usually within 12–24 months.
What lenders typically review
- Completed builds in recent years
- Land value, title, and zoning
- Plans, permits, and schedule
- Line-item budget with contingency
- Projected completed value from comparable sales
- Credit score and cash for closing and overruns
Where it’s available
Ground-up construction financing options are available across most eligible U.S. markets, subject to lender requirements and approval. The Realty Capital Financial program referenced on this page currently excludes North Dakota, South Dakota, Vermont, Puerto Rico, and Guam.
Published lender examples
What one lender currently publishes
These are examples of parameters an independent lender publishes on its own website. They are not our terms, not offers, and they can change at any time. Final terms come only from the lender after underwriting.
| Published loan range | $200,000–$4 million |
|---|---|
| Credit | Minimum credit score around 640 |
| Loan-to-cost | Up to 90% loan-to-cost |
| Loan-to-value | Up to 75% of purchase price or land value |
| ARV / completed-value limit | Total loan generally limited to 75% of completed value |
| Term | 12–24 months |
| Interest structure | Interest reserves may be included |
| Prepayment | No prepayment penalty advertised |
| Experience | Construction experience required |
| Property types | Residential 1–4 unit new construction |
| Not available in | ND, SD, VT, PR, GU |
| Also published | Up to 100% of qualifying construction costs |
Example of currently published lender parameters only. Not an offer or commitment to lend. Terms may change without notice and depend on lender underwriting, borrower and property eligibility, and geographic availability. Values described with “up to,” “may,” or “around” depend on lender underwriting.
Source: Realty Capital Financial published program page. Information last reviewed .
Information last reviewed:
Ground-Up Construction questions
What is a ground-up construction loan?
A ground-up construction loan is short-term, business-purpose financing used to build a new property from land or a cleared lot. The lender typically funds part of the land cost and some or all of the construction budget, releasing construction money in draws as work is completed. Loan size is usually capped by both loan-to-cost and the property’s projected completed value.
How much of a construction project can be financed?
It depends on the lender, the project, and your experience. As one example, a lender currently publishes up to 90% loan-to-cost, up to 75% of the purchase price or land value, and up to 100% of qualifying construction costs, with the total loan generally limited to 75% of completed value. Those are maximums, not guarantees, and every deal is underwritten individually.
Do I need construction experience?
Generally, yes. The ground-up program we reference lists experience as a requirement, and most construction lenders want to see recent completed builds. If you are newer, partnering with an experienced builder or general contractor and showing that team in your scenario may help, but final eligibility is always the lender’s decision.
Can interest be covered during construction?
Some programs include an interest reserve, which sets aside loan funds to cover interest during the build so you are not paying it monthly out of pocket. The reserve increases the loan amount and counts against leverage limits. Whether a reserve is available, and how large, depends on the lender and program.
Where are financing programs available?
Availability depends on the lender and the program. The ground-up construction program we reference lists most U.S. markets but currently excludes North Dakota, South Dakota, Vermont, Puerto Rico, and Guam. The fix-and-flip program we reference currently excludes Nevada, South Dakota, Utah, and Vermont. Other lenders may cover different areas. Every program is subject to lender licensing and approval.
Have a ground-up construction deal?
Send the basic project details. We’ll review the scenario and identify potential next steps.
REI Capital Consulting LLC is not a direct lender. Financing is provided by independent third-party lenders. Programs are subject to lender underwriting and approval.