Course Number: ABA
Course Code: ABA
Residential construction is a specific type of construction. It is unique in that repayment is not from cash flow or operating the property as income producing, but rather from the sale of units. In this course, learners will examine the distinctive aspects of homebuilder loan requests, including the risks.
Homebuilder Lending is one of the courses in RMA’s Commercial Real Estate Lending Decision Process (CRE-LDP) library.
Produced by the Risk Management Association
After completing this course, students will understand:
- Explore acquisition, development, construction lending, and associated risks
- Compare and contrast homebuilder lending to other CRE construction lending
- Identify the risks of AD&C
- Complete a discounted cash flow analysis
- Calculate a sensitivity analysis assuming a changes in lots sold per quarter
Audience: Commercial lenders and credit analysts who are not real estate specialists but who need to know more about assessing real estate risk.