Funding required for a $2M construction project. suggestions?

Question

Need a funding for a $2M construction project in mississippi. Owner don't know about the DSCR. Need funding in less than a month. Any suggestions?

Doug Smith · Answer

Hi Bilal, I have several questions that might help us answer your question. You mentioned Construction Project, but then something about the owner not knowing about the DSCR. Could you please explain? The DSCR product is a long-term financing product for a rental property and is not something that is used for construction until you finish the project and decide to hold it long-term. I see it's a $2M construction project. What does/did the land cost? Did you already buy it? Is there loan against the dirt? Is it a raw lot/land or is there a current structure that needs to be demolished? How much will the actual construction costs be? How much do you already have in the deal? Do you have a contractor and a detailed scope of work? Do you have plans, specs, and permits? What experience do you have with these types of projects? When do you plan on breaking ground? How long will construction take until you have a C/O? What type of property are you building? What exit strategy do you have? Any lender will need to know these things and they/we will have even more questions. If you can share with us the answer to those questions, you're likely to get a pretty detailed answer, but with the limited information you've provided us, it is impossible for any of us lenders to provide you with meaningful feedback. I assure you, many of us on here do want to answer your questions and help you, but we simply need more info. Thanks so much.

Mike Grudzien · Answer

Good job Doug.  Bilal: answer the questions.

Nicholas Cokas · Answer

@Bilal Nasir — Doug asked great questions above, definitely answer those. I'll add one thing nobody's touched yet.

The first question that changes everything here: are you building to sell or building to hold? If you're selling, DSCR is irrelevant — you just need a construction loan with an exit on

sale. If you're holding as a rental, DSCR becomes critical after construction, because your permanent takeout refi (the loan that pays off the construction loan) will be underwritten on

stabilized rental income. That's the number your lender will care about at the finish line, even if it doesn't matter today. The metric that matters during construction is LTC

(Loan-to-Cost), not DSCR.

At $2M ground-up in Mississippi, also worth checking: is the site in a designated Opportunity Zone? Mississippi has 158 OZ tracts, and if yours qualifies, it opens a different equity  sourcing path that reduces how much cash you need to bring. And if it's a rural area, look into USDA Business & Industry loan guarantees — they back construction projects up to 80-90%  and are heavily utilized in MS specifically.

One more thing on the 30-day timeline: private construction lenders can absolutely close in 30 days, but only if permits are pulled, plans are approved, and your GC has a verifiable  track record. Some lenders will actually count your GC's experience as a substitute for yours if you're newer to ground-up — that's the provision that saves a lot of first-time  developers.

What type of property is this (multifamily, commercial, SFR), and what's the exit plan?

Mayo Gilfurt · Answer

$2M ground-up in MS can be done, but structure depends on:

– % of project already completed

– Total project cost

– Borrower liquidity

– Builder experience

– Exit strategy (sale vs hold)

DSCR doesn’t apply to construction — that’s for stabilized income property.

If the owner can provide plans, budget, and projected ARV, this can be positioned with either a construction lender or short-term capital depending on timeline.

Happy to review details direct

Mayo Gilfurt · Answer

For ground-up construction, DSCR usually isn’t the gating item upfront — lenders focus more on experience, cost basis, equity, and exit strategy.

With a <30-day timeline in Mississippi, this is likely a private construction or bridge-to-construction structure, not conventional.

A few quick clarifiers that will determine feasibility: • Total project cost vs. as-completed value

• Sponsor construction experience (or GC strength)

• How much cash is going in

• Planned exit (perm, refi, or sale)

If you want, feel free to DM me happy to sanity-check the structure and tell you if this is financeable or a dead end.

Matthew Bernal · Answer

For a $2M ground-up project, DSCR isn’t the right product, that’s for stabilized rentals. You’ll likely need a construction or bridge loan structured around your build timeline and exit plan.

Funding in under 30 days is possible with the right experience, budget, and documentation in place.

I work with investors on structuring construction and bridge financing. I would be happy to connect and see if this is something we can help with.

Funding required for a $2M construction project. suggestions?

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