All Forum Posts by: Adrian Lemus

West Palm Beach, FL

Good evening, 

So I just ran into an issue. I bought a vacant lot and had the ball rolling with everything that needed to be done to do a new constrcution, permits approved last week which the company that was financing the build was waiting to start issuing the funds. At last minute, they pulled out and left me stranded and they said that the main reason was because of Covid19. Unfortunately, they are in South Dakota and they don't see the moving parts and how real estate hasn't slowed down. All the big companies keep buying more vacant land and building more, one company is scheduled to build 3500 doors and that's not including the other 4 big companies down here. 

I have been searching for a new lender that will be willing to fund my new construction. Does anyone have any suggestions?  

Hi Nate, I concentrate in WPB but I have been looking to start doing a few in Miami. Let me know what you're looking for

@Kyle J. 

After two days trying to reach the person in charge of my account they finally answered my question and it's exactly as you explained! 

Thank you!!!

It's a new construction loan for 8 months term 

Hi Biggerpockets, I need some clarification on what the lending company is going to really charge or better yet on how to do the Proper Math! 

On the contract it says the following:

The applicable annual rate will be 4.99% for the first month, increasing .5% for each subsequent month, up to a maximum annual rate to the lesser of 7.99% and the maximum amount permitted. 

I have had several people telling me different things. How do I go about on doing the proper math to understand how much interest will be charged? I totally understand the increments of .5% each month but what I don't understand is how the interest gets applied.

The 2 different options that keeps popping up from people that tries to explain this to me is the following:

If I borrow $100,000

Option A:

1st Month: $100,000 x 4.99% = $4,990 interest

2nd Month: $104,990 x 5.49% = $5,763 interest

3rd Month: $110,753 x 5.99% + $6,634 interest

Option B:

1st Month: $100,000 x (4.99% / 8) = $623 Interest

2nd Month: $100,623 x (5.49% / 8) = $690 Interest

3rd Month: $101,313 x  (5.99% / 8) = $758 Interest

@Bradley Kesselman Thank you! Yes it is in WPB

@Eli Schwartz Thank you!

Thank you Mitchell! Yeah, and to top it off I got myself in a tough lot because of the FPL Transmission lines but once I am out of this project I will be better prepared and have things run a lot smoother. 

Thank you for the invite! I will try to make it! 

I sold my Primary thanks to my Brother in law. His specialty is flipping lots and I jumped right in by purchasing an empty lot with my profits which was a pretty scary thing to do.

The lot is ready to go, I got it cleaned up, prepped the pad for the house, and all I am waiting on now are the Permits to get approved which we are in almost 2 months now waiting.

I'm already working on getting the money from a lender but I'm wondering if there are better options out there to finance my construction? What should I look for? Into?

I did mention my brother in law bread and butter is flipping lots, but he has the money to go in and not feel and damage which is why he can't really help with the financing part of my build. Why don't I ask him to help me? I have the number one rule, Don't mix Money and Family together. 

This is my first build of many and loving the experience I am getting from this, the networking I have done and the people I have met along the way which I know will be of great help in my future builds. Only thing I am stumped with his the Money situation to finish my builds.

Any information, advise and/or opinions would be great!