Construction Loan
A construction loan is made to individuals, builders or developers to fund the construction of single family homes, commercial property or multi-unit developments. These are short-term loans, made to permit construction of the subject property and are repaid from the permanent financing, either from NVE or from another lender.

Features:
These loans are made for construction of the subject property and are not meant as permanent financing. They are available to individuals, builders or developers. Generally approved for an individual only after the borrower has been pre-approved for permanent financing (by NVE or another lender). Development loans may be issued as individual loans or as a revolving line of credit to permit sequential construction of multiple units or parcels. The loan proceeds are not released all at once, but are disbursed according to the release formula in the construction loan agreement. For commercial construction loans, personal guarantees of borrower or company principals are required.

Rates:
Maximum term 12 months. The interest rate is prime + 1% - adjusted monthly. Borrowers are responsible for all third party costs, including bank’s review attorney. Points may be charged on the loan (a point is a premium or fee equal to 1% of the amount of the loan).