Ground-Up Construction Loan for SFR in Cheyenne, Wyoming

RCN Capital, a national direct private lender, funded a $351,653 1st lien position ground-up construction loan for a residential investment property in Cheyenne, Wyoming. We provided 75% of the total project costs. The Borrower had already purchased the property for $155,000. We provided an initial advance of $129,000 which included a payoff of the previous lien and closing costs. In addition, we funded 100% of the $222,800 construction budget. The property had an existing single-family residence, and the plan was to build a duplex on the lot with an end goal of having 3 units on the property. The completed value was estimated at $630,000 so our loan-to-completed value was 55%. All necessary due diligence was in place: survey, environmental review, CFSI contractor review, and CFSI feasibility study. The Borrower had completed 3 ground-up projects recently which qualified them for a higher loan-to-cost. They had a mid-FICO score of 719 and sufficient liquidity. The structure of the loan resulted in a solid return on investment of 34.37% for the Builder. They plan to refinance into a long-term rental loan upon completion. The interest rate was 11.99%, and we charged 2% origination points. The loan term was set at 24 months. This ground-up construction loan was funded in July 2023.