construction loan

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Construction loan

A short-term loan to finance building costs.

Construction Loan

A short-term loan used to finance the building of some real estate project. The builders take out a construction loan in order to begin the project while they obtain long-term funding. Because there is no guarantee that the builders will be able to obtain long-term funding and a construction loan is not intended to fund an entire project, construction loans are fairly risky, and, as a result, have high interest rates.

construction loan

A short-term mortgage taken to finance the construction of a real estate project before permanent long-term financing is obtained. Because of its relatively high return, some real estate investment trusts specialize in this type of loan. Construction loans are often more risky than long-term mortgages.

construction loan

A loan originated for the purposes of providing payment for construction work or subdivision development.See also building loan agreement.
References in periodicals archive ?
The agreement with Trimont equips Amalgamated with access to top talent in loan sourcing, credit underwriting and construction loan servicing, thereby enabling the bank to expand funding for the construction and rehabilitation of affordable homes for working families.
According to the central bank of Taiwan, construction loans posted slow growth in Taiwan.
Bank provided a USD 43m construction loan for the initial phase of Village at Meridian, a retail center located at North Eagle Road and East Fairview Avenue, adjacent to the new 60-acre Julius M.
Third-party construction loan administrators provide an efficient and effective means for lenders that do not have the in-house resources and capabilities to offer construction loans.
Market observers say that the obvious growth in construction loans reflects the bullish real estate market, mainly driven by rising purchases of local properties by both Taiwanese and Chinese mainlanders due to the improving relationship between the two sides of the Taiwan Strait.
TRW REDI Property Data reported lending institutions approved construction loans worth $147 million in Ventura County during 1995, which was down by 7.
Umpqua Bank received more than USD25m in custom construction loan applications in the first half of 2010.
TCL is fully integratable, and simplifies the administration of construction loans by giving lenders a way to manage relationships with service providers, automate property inspections via the Web and reduce call-center workload.
Condo construction loans outstanding fell sharply as well, while apartment construction loans outstanding increased slightly, with the net result of a 3% decrease in multifamily construction lending.
Eli Verschleiser, a founding partner at MCG stated that ha today's market it is not a secret that it is difficult to fund ground up construction loans, but ha the past 30 days, MCG has closed two new construction loans for EB Developers.

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