Cetan Funds recently funded a duplex construction loan for a build in Coos Bay. The borrower is a local general contractor and homebuilder. They owned this lot and had aspirations to build it out to become a cash flowing investment property to generate passive income. They owned the land and their plans and permits were approved with the city. They just needed the construction funds to get it built.
Local banks and credit unions proved difficult to work with, especially given their goals of building it for investment purposes. Traditional construction lenders prefer to lend on a borrower’s future residence. Additionally, their documentation and construction disbursement requirements for a self-contracting builder were incredibly cumbersome. They did not have time to waste while they ran their contracting business.
Cetan Funds was able to provide the simple and effective financing to get this duplex built. The project is progressing nicely at this point. Once complete, the borrower will rent the units and refinance with a conventional or debt-service-coverage-ratio loan.
Loan Purpose
Cetan Funds offers residential construction loans for the ground-up construction of residential property for business and investment purposes in Oregon and SW Washington. These loans are perfect for both real estate investors, small homebuilders, general contractors or residential developers looking to build homes to then sell or rent out. Speculative construction for business or investment purposes can be difficult to finance with a traditional lender. Cetan provides these types of residential construction loans.
Cetan Funds’ residential constructions loans typically fund up to 80-90% of the project costs. The loan typically funds the costs of ground-up construction after building permits have been approved. These loans are typically 12 months with interest only charged on the outstanding balance. The builders draw down the construction line of credit as work is completed on the project. Upon completion the borrower would either sell or refinance the property.
Location
Loan Terms
$343,000 at 12.0% interest only on funds drawn for 12 months
