Spotsylvania, VA – New Construction

The Opportunity

A Virginia building team focuses its projects in and around Fredericksburg, Virginia, in the area bounded by Richmond, Charlottesville, and Washington, D.C. It has successfully completed and sold builds in towns like Locust Grove, Mineral, Gordonsville, and Beaverdam, while building 40+ homes a year.

In this deal, the team found a lot in Spotsylvania that was ready to build. After purchasing the land for $62,000, they were ready to build. They turned to their lender of choice—Lima One Capital.

The Solution

Lima One has supported this builder with loans for more than 160 projects over four years, and so our team knew what was important to this customer. We financed this build with 89% percent leverage of the costs of land plus the $300K construction budget, while leaving plenty of potential profit on the after-repair value. Most importantly, Lima One closed this loan in three weeks—delivering the fast underwriting and processing necessary to help the builder keep projects moving through their pipeline.

Lima One provided the builder with high-leverage financing at low interest rates that gave the builder credit for an incredible track record of success. This helped the builder maximize profit on the build. In addition, the builder benefited from quick construction draw funds offered by Lima One’s in-house team. The builder also had the security of knowing that Lima One could offer rental property financing if they decided to hold the property, as they had on a handful of the team’s properties in the past.

The builder did their normal excellent job, delivering a quality home at an attractive price point for the Virginia market. The home sold for $460,000 ($10,000 over asking) after spending just 29 days on market. This allowed the builder to capture a strong profit on this deal and move on to the next one—with Lima One ready to finance the next deal and power the builder’s continued success.