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Ground-up construction loans in Charleston
Financing to build from the ground up, lot included: infill houses, new rentals and spec homes across the Lowcountry. Experienced builders can borrow up to 90% of the total project cost.
Construction loan terms
| Experienced builders | up to 90% of cost |
| Standard | up to 85% of cost |
| Limit on finished value | 70 to 75% |
| Lot cost financed | up to 70% |
| First-time builders | programs available |
| Smallest loan | $75,000 |
Builders with fewer recent projects, and smaller markets, are usually limited to 80% of cost.
Two limits decide the loan
Loan-to-cost measures the loan against what you spend on the lot and the build. Loan-to-value measures it against what the finished property will be worth. A construction loan has to fit inside both.
- The lot: up to 70% of what you paid can be financed.
- The whole project: normally up to 85% of cost.
- Experienced builders in major markets: up to 90% of cost.
- Less active builders and smaller markets: usually up to 80% of cost.
- Always: no more than 70 to 75% of the finished value.
Example
| Lot | $180,000 |
| Construction budget | $520,000 |
| Total cost | $700,000 |
| Finished value | $975,000 |
| 85% of cost | $595,000 |
| 90% of cost, experienced builder | $630,000 |
| 75% of finished value, the ceiling | $731,250 |
Who qualifies
Your record sets your leverage. Builders with completed projects get the most. First-time builders are not shut out: we have programs for them too.
Building in the Charleston area
- Flood elevation. In a FEMA flood zone the finished floor has to be built to the required elevation, which can mean raised foundations, fill and higher costs. Get the base flood elevation and the local freeboard requirement before you finalize plans.
- Infill and zoning. Many Charleston projects replace an older house on an established lot. Confirm setbacks, lot coverage and any overlay with the city or town before you close on the lot.
- Historic review. In the City of Charleston’s historic districts, the Board of Architectural Review approves new buildings and demolitions. Build approval time into the schedule.
- Trees and drainage. Protected grand trees and stormwater rules can shape the footprint and the site work. Check them early.
- Growth areas. Summerville, Goose Creek, Johns Island and the edges of North Charleston have more buildable land and newer subdivisions, and lots there tend to cost less.
From construction loan to rental loan
Many investors build to keep. When the home is finished and leased, a DSCR rental loan pays off the construction loan and replaces it with long-term debt.
Finishing a stalled build
A construction completion loan lends against the project as it stands today and adds what is needed to finish it.
Documents we ask for
- Loan application and personal financial statement
- A line-item construction budget with a clear scope of work. Draws are paid against it
- Plans and drawings
- Your general contractor’s license, workers’ compensation certificate and recent completed projects
- Your own projects from the last 2 years, with settlement statements
- Two months of bank statements showing reserves
- Insurance and closing attorney contacts
The full list is in our hard money loan document checklist.
Construction loans: common questions
Normally up to 85% of the total project cost, and up to 90% for experienced builders in major markets. The loan must also stay within 70 to 75% of the finished value.
Yes. Up to 70% of the lot cost can be financed, as long as the total loan stays inside the loan-to-cost limit.
Yes, we have first-time builder programs. Leverage rises with a record of completed projects.
Yes. Replacing an older house with a new one, or building on a vacant lot in an established neighborhood, is a common Charleston project. Confirm zoning, any historic review and the flood elevation before you close on the lot.
Yes. A construction completion loan is based on the current as-is value plus the cost to finish.
Have a lot and a set of plans?
Send the address, the price and what you plan to do with the property. We will reply with the leverage and pricing that fit your deal.