|Posted by: Lucille May 19 2004, 09:11 PM
| I really hope someone can give me some guidance here.
My family and I own a vacant lot in the city and it's already zoned for duplex residential. We would like to obtain a construction loan to build a duplex for non-owner occupied income producing property. A couple of general contractors have given us quotes of approx. $120,000 to build (We're in the south and construction is approx. $60/sq ft in this area). My question is the following:
If we form an LLC, is commercial financing available for this type of construction loan since the amount is so low or what type of financing would be available to us?
|Posted by: loanuniverse May 20 2004, 09:44 PM
The idea behind creating a separate legal entity such as an LLC is to keep the possible liabilities that the venture might incur from affecting other assets that you might own. I personally think that for residential real estate it is a little bit of overkill specially with only 2 units.
Frankly, I do not deal with requests of this size. Something at this level might be done through the small business department or maybe even residential.
In your position , I would approach a couple of local residential lenders and ask them if a residential type of construction loan is available to a borrower that is an LLC. In the case that the answer is no then you have to ask them what kind of loan could be available or maybe reconsider the LLC scenario.