$7.4 Million Loan Obtained for Residential Building

The Challenge

The proposed development required a $7.4 million construction loan and involved extensive review of the lender’s proposed financing terms and conditions.

During review of the loan commitment, Nochumson P.C. identified discrepancies involving the proposed interest rate and several business terms that had not been fully addressed in the original financing documents.

The transaction also required review of title insurance matters and preparation of legal opinions relating to the enforceability of the loan documents and the developer’s corporate structure.

The Solution

Nochumson P.C. carefully reviewed and negotiated the construction financing documents on behalf of the client.

After identifying concerns regarding the proposed interest rate, the firm worked with the client to address the issue directly with the mortgage lender, ultimately helping secure a reduced rate more consistent with prevailing lending terms.

The firm also negotiated revisions to several provisions omitted or insufficiently addressed in the original loan commitment while coordinating directly with the lender’s attorneys throughout the process.

In addition, Nochumson P.C. reviewed the title commitment issued for the transaction and prepared the legal opinions required in connection with closing the construction financing.

Construction loan transactions for large development projects often involve detailed negotiation of financing terms, title protections, corporate authority requirements, and lender conditions prior to closing.

The Results

The $7.4 million construction loan successfully closed, allowing the client to move forward with development of the 66-unit mixed-use apartment building.

Construction of the project is now actively underway as part of the client’s larger Philadelphia development plans.