Cohousing-L Mailing List: Re: Construction Loan Financing

[Rich Lobdill (richardl]

Denise Meier wrote:


they required 20% of the APPRAISED value of the project, which was
considerably less than the COST of the project. We each (except for the
two subsidized low-income units) ended up putting in 35% of our projected 
purchase price, plus paying for upgrades and change orders in cash.


Denise: I hope you meant "... which was considerably *more* than the COST of 
the project...".

If your project appraised for a lot less than the cost, the permanent financing 
(or 'take out' loans) for each house would only cover a portion of appraised 
value and you would have to have a significant cash down payment. Could be 
done, but would not bode well for resale values.

Rich Lobdill
Tierra Nueva Cohousing.