crunching new build numbers and financing

[Sean Kelly]

Hey guys, evaluating a SFR new build deal here in Nashville. This is my first new build deal.

I would finance the acquisition and construction of the property, partnering w/ the builder to split profits 70/30 me/builder, and also list the property as the agent.

I would purchase the land with hard money, then finance the project with a bank, splitting profits 70/30 w/ the builder. 

Question for new builds: Im putting 20% down for land cost (hard money), then 10% down for total project cost, yes?

For example:

If land cost is $50k and build/holding/etc. cost is $100k .. total project cost $150k

I would put $10k down for land, then bank would lend me 90% of total project cost--$135k. Yes?

Do I need to put 10% down for the project cost then?

This math is fuzzy to me

[Wayne Brooks]

A 90% loan for a spec build seems awfully optimistic. Find a lender before you get too far into it.  Nor sure why you'd use the hard money first.