Construction loans for commercial real estate (CRE) remain a major part of commercial bank lending. Many community banks attempt to use versions of their residential formats and policies to administer commercial construction loans; however, this generally does not adequately control the situation due to several important differences between residential and commercial projects. This program provides an overview of the key steps involved in effectively administering commercial construction loans.
Recorded 9/16/24 – Length: 2 hours
What You’ll Learn
What is construction risk and how is it mitigated?
Differences between residential and commercial construction loans
What is High Volatility CRE (HVCRE)?
Issues with contractor qualifications, construction contracts and budgets
The type of project (full construction vs. renovation, etc.)
Title insurance
Survey
Bonding
Funding and draw controls
Inspections
Lien waivers and lien updates
Monitoring usage of budget contingency
Line item transfers
Completion of the project and (if applicable) stabilization
Who Should Attend
Commercial lenders, credit analysts and support staff that deal directly with commercial construction loans; mortgage bankers, private bankers, small business lenders, loan review specialists, special assets officers, lending managers and credit officers indirectly involved in the construction lending process.
Instructor Bio
Richard Hamm has been training bankers for 28 years, designing and delivering courses specializing in commercial lending and credit, including portfolio and risk management, commercial real estate (CRE) and appraisals, plus selling and negotiating skills, and director training. He also conducts eight senior lender forums on a periodic basis in multiple states and one series at the national level.
He is based in Huntsville, AL and has owned/operated Advantage Consulting & Training for 14 years, after a 22-year banking career including senior positions in lending and credit, plus president of a community bank through formation and acquisition of an existing bank. He has BS and MBA degrees from the University of Alabama.
Code: O6097OD
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