7 Common Mistakes to Avoid with Land Development and Construction Loans

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7 Common Mistakes to Avoid with Land Development
and Construction Loans
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Do Your Research, Such As Comparing Rates And
Terms With Other Lenders
When you apply for ground-up construction hard
money loans, the lender will scrutinize your
project heavily to make sure it is a wise
investment. You need to do your homework and
compare rates and terms with other lenders before
signing on the dotted line.
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We Leading Finance and Technology
If you have a lower credit score, options are
still available, but it's essential to be aware
of the potential consequences before applying for
a loan. For example, you may have to make a
larger down payment or not be approved for the
loan.
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Not Checking for Zoning Changes
If you're planning on developing a piece of land,
it's crucial to ensure that the zoning hasn't
changed since you last checked. Zoning changes
can completely throw off your plans, and they can
be costly to change. For example, if you
construct a house in a rural area, you might not
be too worried about zoning changes. However, if
you are constructing a high-rise in a downtown
area, any change in zoning could significantly
impact your project.
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Not Checking the License of the Moneylender
Before signing on the dotted line, check that the
moneylender you're working with is licensed. It
may seem like an obvious point, but it's often
overlooked and can have disastrous
consequences. A licensed moneylender will be
regulated by a government body, which means
they'll be held to certain standards and must
follow specific procedures. It protects you, as
the borrower, from being taken advantage of.
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Choosing the Wrong Type of Loan
If you're looking to construct a property on the
land, you'll need a construction loan. This type
of loan is specifically designed to fund
construction projects, and it has different
features than other loans.
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Not Verifying the Appraisal
An appraisal is an assessment of the value of a
piece of property. It's essential to get one
before you take out a loan for land development
or construction because it will be used to
determine how much money you're able to borrow.
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Not Understanding the Loan Process
The loan process for land development and
construction loans can be complicated. Make sure
you understand all of the steps involved before
applying for a loan. For example, you must
gather all the documentation required, such as
the plans for the project, before you can even
begin to fill out a loan application.
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Contact Us
1 713-823-5189
contact_at_vistafundingllc.com
https//www.vistafundingllc.com/
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