No income verification construction loans

This program finances ground-up construction of residential investment property. Approval does not depend on your tax returns, W-2s or pay stubs.

Instead, our lending partners look at three things. Your credit and cash reserves. Your track record as a builder. And the property’s projected value once it’s built.

The loan typically covers part of the lot purchase and most of the construction budget. Funds are released as the build progresses. Terms run 12 to 18 months, long enough to build and then sell or refinance.

The program is built for experienced builders and contractors. You’ll need at least two completed projects. Builders with three or more can typically get a larger share of construction costs funded.

It is a good fit if:

• Your tax returns don’t reflect your real income or liquidity
• You build spec homes, small multifamily or townhome projects to sell or rent
• You’re a foreign investor building in the U.S. without U.S. income documents

This loan is for investment property only. You cannot use it to build a home you or your family will live in, including a second home.

Eligible properties are non-owner-occupied:

• Single-family homes and 2–4 unit buildings
• Townhomes
• Condos

No other property types qualify. For larger multifamily or commercial construction, see our debt programs. To renovate an existing property instead, look at fix and flip loans.

These figures are loan-to-cost: the loan as a share of what you spend on the lot and the build. Your middle credit score is the middle of your three bureau scores.

Rates are higher than bank construction loans. That reflects the lighter documentation and the risk of an unbuilt property.

Lenders typically look for:

• Credit. A middle credit score of 680. Scores down to 620 may be considered case-by-case.
• Experience. At least two completed building projects.
• Down payment. Typically 25% of the land cost and 10% to 15% of construction costs.
• Reserves. Proof of liquid assets, such as bank or investment account statements.
• Projected value. The appraiser estimates the finished value from your plans and cost breakdown. That value is often called the after-completion or after-repair value (ARV).

To issue an approval, our lending partners typically ask for:

• The lot purchase agreement, or a settlement statement if you own the lot free and clear
• Credit authorization
• A copy of your Social Security card and driver’s license
• Three months of bank statements
• Architectural plans and a full construction cost breakdown
• An appraisal, ordered during underwriting

Approval is generally faster than a traditional construction loan, often a few weeks. Timing depends on how complex the project is. Fees vary with the complexity of the deal.

You don’t receive the full loan at closing. The lot portion funds first. Construction money is then released in stages, called draws, as the build hits set milestones.

Before each draw, the lender typically confirms the work is done, often with an inspection. Keeping your budget detailed and your schedule realistic helps draws go out on time. For more, read our guide to construction loan draw schedules.

Less paperwork does not mean less risk. Before you apply, consider:

• Higher rates. Total borrowing cost is typically higher than a bank loan.
• More cash in. Down payments can be larger than with full-documentation loans.
• Foreclosure risk. If you can’t make payments, the lender can foreclose on the property.

Have a clear exit. Most builders sell the finished homes. If you plan to keep them as rentals, a DSCR loan can refinance the construction loan based on rental income.