HOME / GROUND-UP / RECENT LOANS / CHARLESTON, SC

$1.87M ground-up build in Charleston, SC — 85% LTC, 14-day close

Illustrative case study modelled on typical files for this program; figures are examples, not a funded loan.

Land: $550,000
Construction budget: $1,650,000
As-complete value: $3,100,000
Loan: $1,870,000
Loan-to-cost: 85%
Rate: 9.00%
Points: 2
Term: 24 months, interest-only
Days to close: 14
Units: Single-family
Exit: Sale

Rendering — the finished build, Charleston, SC

THE STORY

Situation

A custom-home builder bought a premium lot near Charleston to build a high-end spec home, relying on recent luxury sales to support the as-complete value.

Structure

The loan funded 85% of the $2.2M total cost at 9.00% with two points on a 24-month term, inside the 75% cap on the $3.1M as-complete value. Plans, finish specifications and the builder’s completed luxury homes were in at application; the close took 14 days.

In numbers: a $1,870,000 loan against $2,200,000 of total cost left $330,000 of borrower equity in the deal. The value test — 75% of the $3,100,000 as-complete value ($2,325,000) — sat above the loan, so cost, not value, set the size. Fully drawn, interest-only carry at 9.00% works out to about $14,025 a month, and 2 points of origination came to $37,400 at closing.

Draws

Foundation, framing, rough-in and final draws were released on photos and invoices, with finish-level line items in the approved budget.

The file

What was in the file: the land documents, the plans and specifications, the itemised hard- and soft-cost budget and build schedule, the as-complete value estimate with comparable new-construction sales, the GC agreement with license and insurance, builder’s risk insurance, and bank statements showing the cash to close and six months of reserves. The appraisal valued the home as complete against recent new-construction sales nearby. Every checklist item came back inside 48 hours, which kept the close at the fast end of the range. Title was opened on the day of application and insurance was bound before the appraisal came back. The term sheet set the final leverage and pricing against the published maximums.