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What are the different types of financing for a development project?

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What are the different types of financing for a development project?

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Construction Loan: A short term loan, usually up to 12 months, depending on the size and complexity of the project. Once the project is completed, signified by the issuance of a Certificate of Occupancy, the short term lender will call in his note for the principal to be paid. b) Permanent Note: Often called an end loan, which is a long term loan, either fixed and/or variable, for different periods of time. This end loan will take out the short term loan “construction loan”, and convert it into a permanent loan. c) Combination Construction Loan and Permanent Loan: It is highly recommended that any project have this type of loan in place, to make sure that after the development of the project is completed, the permanent loan will be put in place automatically. With this type of loan, there is only one closing cost for the project.

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