Nationwide
Commercial Construction Loans Nationwide
Commercial Construction Loans Nationwide
Prosper Financing offers conventional construction loans for commercial real estate properties and SBA-504 companion mortgages for transactions that are approved via the Small Business Administration that require a construction phase. If you have any questions about our programs please contact one of our loan officers.
| Loan Type | *Property Type | Min Loan Amount | Max LTV | Term Length | Amortization | Rates |
|---|---|---|---|---|---|---|
| Conventional Construction | A, I/W, M/H, MU, O, R, SS | $1,000,000 | 70% | 12–36 Months | Interest Only | |
| SBA Construction | I/W, M/H, MU, O, R | $3,000,000 | 80% | 12–36 Months | Interest Only |
*A = Apartment I/W = Industrial/Warehouse M/H = Medical/Healthcare MU = Mixed Use O = Office R = Retail SS= Self-Storage
Related Links: | Apartment Construction Loans | Industrial Financing | Mixed Use Mortgages | Office Mortgages | Retail Commercial Loans | Self Storage Loans
LTV: Up to 70% loan to cost or loan to value (whichever one is lower)
| Coverage Area: | Nationwide (primary and secondary markets preferred) |
| Loan Amount: | $1MM to $100MM |
| Experience: | Prior construction experience highly preferred |
| Property Types: | Most property types considered |
| Occupancy: | Owner occupied and investment properties |
| Rate: | Starting rate at Prime + 1 (floor rate might be required) |
| Amortization: | Interest only during construction |
| Reserve Account: | A reserve account will be used to make monthly payments on behalf of Borrower until construction phase is finished and property is ready for take-out financing |
| Builder: | Must be approved by lender. Builders get paid in arrears |
90% LTV Commercial Construction Loans (with SBA 504 Program)
| Construction Loans – Interest Rate: | Multi-use property: Prime + 1%, with a 7% floor Special-Use property: Prime + 1.5–2.0%, with a 7% floor |
| Commercial Construction Loans Fee: | 1.0% Minimum |
| Eligible Properties for Commercial Construction Loans: | Multi-use properties and currently acceptable special use properties will be considered if the credit is sufficiently strong to justify the transaction. Must be located in an identifiable MSA. The project must be located in an area suitable for the intended use. Construction costs must be within acceptable norms (no unusual types of construction or elaborate improvements allowed) |
| Borrower / Eligible Operating Company Requirements: | Must have DCR ≥ 1.25 for the proposed debt over the past two years or acceptable trends for expansion. 4 years of operating history or equivalent experience required. Financial strength should be at or above industry average. Strong credit, cash flow, and liquidity to cover 10–15% overruns. Owners’ combined net worth ≈ 35% of loan amount. FICO ≥ 700 for all owners (>20% ownership). Ineligible if borrower/principal has filed for bankruptcy. May qualify for higher LTV with additional collateral/contingency. |
| Fund Control / Bond / Third Party Guaranty: | Lender selects fund control company. If LTV > 65% and costs > $500,000 or 25% of project, a third-party guaranty is required. |
| Permanent Loan: | Lender’s current permanent loan program remains in effect; SBA approval required. |
| Underwriting Requirements: | Contractor Qualification statement Detailed cost breakdown Construction contract Plans and specifications Building permits |
| Fee Summary: | Construction Loan Fee: 1% of loan amount Loan Documentation Fee: $1,800 Project Review, Fund Control, Guaranty: Quoted case-by-case |
| Commercial Construction Loans Size: | $750,000 – $10,000,000 |
| Maximum LTVs (per SBA 504 guidelines): | 90% for multi-use properties (excludes start-ups) 85% for special-use properties (multi-use start-up) 80% for special-use properties that are start-up businesses |