Description
Notice: This curriculum is unavailable until further notice while Risk Management Association (RMA) implements content modifications. Please check back periodically for updates.
An explanation of the types of construction loans, construction lending underwriting and administration issues , and how to recognize the different elements of the construction lending process. Learn the key elements for successful completion of construction projects, and also the special issues involved with homebuilders and subdivision developers.
Produced by the Risk Management Association
Courses*
*Only available as a series
CRE-LDP 6.1 – Types of Construction Projects and Related Risks
CRE-LDP 6.2 – The Construction Process, Liens, and Project Completion
CRE-LDP 6.3 – Homebuilders and Subdivision Developers
What You’ll Learn
After completing this series, students will be able to:
Identify the six general types of construction loans
Identify the additional risks, considerations, and review needed with construction loans
Explain the steps in determining the proper administration of a construction loan based on approval conditions, the commitment letter, and loan policies and procedures
Identify key concerns in reviewing construction contracts, budgets, and site information
Calculate the adequacy of a construction loan interest reserve requirement
Identify best practices in construction and loan documentation and administration
Identify components of construction loan agreements, surety bonds, permits and zoning, and insurance including steps in processing draw requests and analyzing inspection reports
Identify key elements for successful completion of the project
Identify acceptance by the customer, punch list items, payment of retainage to the contractor, and the certificate of occupancy
Recognize various segments in the single-family home markets and their characteristics
Identify the key issues for administering or monitoring builder construction lines
Build a timeline of the development process and identify developer attributes needed to achieve each step
Identify various types of risk inherent in lending to single-family-home developments, risks from both external and internal sources
Identify the key issues for monitoring homebuilder and subdivision loans
