Bridge loan for developers

He Loan for Promoters It is a type of mortgage-type financial tool whose purpose is the facilitation to a promoter of the construction or rehabilitation of real estate. The objective of this type of loan is that the promoter has access to needs such as the acquisition of the land, the request for the necessary permits to carry out the works, the costs of hiring a construction company, the search for buyers for the property and its subsequent financing.

This type of financing is usually developed in two parts. On one side is the construction phase, in which the promoter must only pay the amount of interest rates that have previously been set by the financial entity that issues the loan and it is the moment in which the promoter must focus greater efforts on finding buyers for when the reform or construction is ready. The interest rates that are set are subject to the movement of the real estate market, in order that the project is amortized in a certain period of time.

Once the construction or reform is ready, it goes to the sale phase, where the efforts made by the promoter to get those buyers will be reflected and that the investment in the real estate product is amortized. The buyer of the real estate can be subrogated to this type of loan, so he will acquire the debt that the promoter contracted with the financial institution in order to carry out the project plan. Buyers enjoy certain savings when it comes to the purchase of real estate, but they must assume the conditions that the promoter and the financial institution have previously established. In this phase, the interest rates are different from those stipulated in the construction phase, since the financial entity binds the final buyer of the real estate to proceed with the collection of the product.

In general, promoters are granted a loan that covers around of the 80% of the financing of the project, which means having the certainty that the project will not be canceled due to lack of financing, but it does not guarantee that other causes may occur, as long as the development of the project conforms to the previously established budget.

In the event that these real estate do not go to the sale phase and remain empty, the promoter must be responsible for the full repayment of the loan plus the interest established until the expiration date of the loan contract or until the sale is achieved. of said goods. On the other hand, if the buyers do not accept the financing conditions that have been stipulated, the loan that has been granted to the promoter is cancelled.

The Loan for Promoters is the financing method that best suits the business needs of the entrepreneur in question, so that their projects are developed according to the plans, since the negotiations with the financial institution They are always carried out under the needs of the employer, offering the best solutions for its development.