09 Feb How To Get A Land Development Loan In Utah
When you are looking into land development, there are a few things that you need to know. Utah is one of the top places in the nation for land development right now. You can look right in our backyard at the city of Vineyard to see just how successful land developers have been. Getting a land development loan in Utah is the first step for many who want to take part in this massive growth. Here you will learn just how to get started in getting the money that you need.
Understand the difference between land and construction loans
The first thing you need to realize is the difference between land loans and construction loans. This is something that most developers overlook. While there are loans that can be combined, this is usually pretty rare. Usually, it is easier to get a land development loan right off the bat. You don’t need all of your suppliers and contractors ready to go for this loan. This is a great place to start with our lending professionals. While the cost of your build is going to be important in the process of securing what is called a lot loan, it is important to first focus on acquiring the land.
Develop a track record in land development
It can be quite difficult to get a land development loan when you don’t have a track record in land development. However, you can build this track record relatively quickly. Consider working with other land developers on deals before you try to break out all on your own. You can also take courses and get certifications that will help you appear more professional to lenders. If you have the ability to, you should use your own money first to create a profitable deal before going to lenders. Once you have developed a great track record, it will be much easier to get a land development loan.
Consider starting a partnership
When you don’t have much of a track record, a business partnership might be what you need to get a land development loan in Utah. When looking for a business partner in land development, make sure that you are looking for someone who has had successful land development deals in the past. There are wide selections of land development professionals in Utah that you could choose from for business partnerships. You might want to look at your warm market as well. You may have friends or family members that would be great to go into business with. This could be an organic partnership that could be very profitable for both of you.
Work with lending professionals
When you are dealing with any kind of lending, it is important to work with lending professionals. Our lending professionals are ready to help you find the very best land development loans in Utah. During our many years in the lending industry, we have learned the ins and outs that can help us help you find a great land development loan in Utah. We will spend the hours it takes to sift through many different lending options that will fit your land development needs.
Understand the higher interest rates
One thing that you are going to have to deal with when getting a land development loan in Utah is higher interest rates. It is important to not get too hung up on this. It is just something that you will have put into the cost of getting this money. There is the option of working with private lenders or angel investors in order to get lower interest rates. Our team of lending professionals will be able to help you find the best interest rates in the industry.
Have a strong development plan
The more solid your development plan is, the easier it will be for you to get a land development loan in Utah. Lenders want to see that you have a firm plan for making a profit off of your deal. It is much harder to approach a lender with just a vague general idea of how you will make money off your land development. Learning how to create business plans, prospective profit statements, and general development plans will help you greatly get a land development loan in Utah.
Determine your building costs
When you determine your building costs, lenders can really see the bigger picture. You will really have to do your legwork on this. With the recent supply chain issues caused by COVID-19, building costs have drastically changed. You may also find yourself on waiting lists as well. It is important to get all of your building costs and timelines in place in order to present them to the lenders. Your lenders are going to want to know if you will be able to keep up with deadlines and make a reasonable profit.
Consider joining a nonprofit
There are nonprofits like Habitat For Humanity that can help you when you are developing land in Utah. If you are helping the community by offering homes to those who aren’t usually able to get them or trying to better a neighborhood by bringing in new homes, they can greatly help with your building costs. There are many different nonprofit options in Utah that can help you with your land development needs. This could be just what you needed to finally get the money you needed for your real estate development.
Land development is really popping right now in Utah. If there was ever a time to get into land development in Utah, the time is now. Our team of lending professionals will be able to help you discover the very best ways to find a great fit for your ideal land development loan in Utah. If you are feeling like you are ready to invest in land and finally follow your passion for real estate development, give us a call today. Our friendly team of professionals will be able to help walk you through all of the different ways in which to get the right land development loan in Utah.