Ground Up Construction Loan 2026: Lender Terms and Real Costs
Quick Answer
As of October 8, 2026, six lenders' own websites say a ground-up construction loan for an investor covers up to 85% to 90% of total project cost, starts at a rate between 8.90% and 9.84% where a rate is shown, runs 6 to 24 months and needs a 650 to 680 minimum FICO where one is stated. These are the lenders' claims, not funded-loan data, and the federal loan record cannot check them: Regulation C excludes a construction-only loan “extended to a person exclusively to construct a dwelling for sale,” so the spec-home loan is missing from HMDA by rule. What public records do show is the cost side. The Census Bureau counted 940,000 single-family homes started in 2025 (7.2% fewer than 2024, our arithmetic) and 105,000 single-family homes completed that were built for rent, 10% of completions. For contractor-built houses started in 2025 the median contract price, which leaves out the lot, was $404,000, or $171.57 a square foot, 37.3% above 2020 (our arithmetic). The number that decides your cash at closing is not the 90% headline but the lender's cap on finished value: at a $450,000 project cost and a $520,000 after-repair value, the same six caps range from $338,000 to $390,000 of loan (our arithmetic).
Key Takeaways
- Six lenders publish ground-up terms (October 8, 2026): Kiavi 85% of total cost and 70% of after-repair value (ARV), Lima One 90% and 75%, Easy Street 90% and 75%, LendingOne 90% and 70%, RCN 90% and 75% for borrowers with 10 or more ground-up projects but 85% and 65% for a first project, and Center Street up to 90% of cost with no ARV cap shown. Terms run 6 to 24 months.
- The ARV cap often decides the loan. A 90% loan-to-cost cap only binds if the finished house is worth at least 1.2 times your all-in cost (90 divided by 75); for Kiavi the ratio is 1.214, for LendingOne 1.286 and for an RCN first project 1.308 (our arithmetic).
- Federal HMDA data cannot see the spec loan. Regulation C excludes construction-only loans to build a home for sale, construction-only loans designed to be replaced by separate permanent financing, loans on vacant land (unless the proceeds will build a dwelling within two years), business-purpose loans that are not purchases, improvements or refinancings, and lenders with fewer than 25 closed-end loans. Only a single-close construction-to-permanent loan is clearly reportable.
- Census: 940,000 single-family starts in 2025 (1,013,000 in 2024), 105,000 single-family homes completed built for rent in 2025 (52,000 in 2019), and a median contractor-built contract price of $171.57 per square foot (West $176.87, South $157.30, Midwest $194.09, Northeast $179.30). The price excludes the lot.
- Material terms the lenders' construction pages mostly leave out: none of the six pages we read states whether the loan is recourse or needs a personal guarantee; only Easy Street (zero to two points and a $1,995 document fee) and LendingOne (a 1.50% origination fee in its own example) give a fee, and only Kiavi and Easy Street say there is no prepayment penalty.
- In seven states' 2025 HMDA files, Easy Street Capital's 1,784 investor loans are all coded “other purpose” with a 6-month median term, and Kiavi's 13,324 are coded home purchase or refinance with a 12-month median. No field says which of them financed construction.
CSV · 241 rows
Ground-up construction loans: lender terms, Census construction data and HMDA coverage, October 2026
241 rows: lender-published terms read October 8, 2026, Census Bureau starts, built-for-rent completions and contract prices, the Regulation C coverage rules, HMDA 2025 counts for seven states and six lenders, and our loan-cap arithmetic. One source per row.
What a ground-up construction loan is, and what it is not
A ground-up construction loan lends against a house that does not exist yet. The lender funds part at closing (usually the lot, or a refinance of a lot you already own) and releases the rest in draws as inspected work is completed, so you pay interest on the money drawn, not on the whole commitment. It is not the owner-occupant construction-to-permanent mortgage a family uses to build its home. Lima One's website puts the difference this way: “a short-term loan, not a 30-year mortgage”; if you keep the house as a rental you refinance into a permanent loan unless you owned it free and clear. This page is about the investor and small-builder version: a spec house you will sell, or a build-to-rent house you will keep.
It sits next to three products we cover elsewhere. A flip loan buys and renovates an existing house (see the best fix-and-flip lenders); a bridge loan is a stopgap until a sale or refinance (bridge loans); and what flips and builds are usually refinanced into is a 30-year rental loan (DSCR lenders). Our hard money rates page has the federal-data record for the short-term loans that do reach HMDA. This page starts where that one stops: the ground-up loan is largely outside that record, and the rest of the page explains why and what you can use instead.
Which construction loans reach federal data and which do not
HMDA is the only public loan-by-loan record of US mortgage pricing, so the first question for any loan type is whether it is in it. For construction, mostly it is not. Regulation C (12 CFR Part 1003) and its official interpretations, in the eCFR version of October 1, 2026 (read October 8, 2026), sort the cases like this:
Which investor construction loans Regulation C requires lenders to report
| Your loan | In HMDA? | Rule |
|---|---|---|
| Construction-only loan to build a house you will sell (the spec loan) | No | Comment 3(c)(3)-2: a construction-only loan is temporary financing if it is “extended to a person exclusively to construct a dwelling for sale” |
| Construction-only loan you plan to refinance into separate permanent financing (a two-close build-to-rent loan) | No | Section 1003.3(c)(3) and comment 3(c)(3)-1.ii and .iii: temporary financing is a loan “designed to be replaced by separate permanent financing” |
| Single-close construction-to-permanent loan that converts automatically with the same lender | Yes | Comment 3(c)(3)-1.iv: the temporary financing exclusion does not apply; comment 2(j)-3: a combined construction/permanent loan is a home purchase loan |
| Loan secured by vacant or unimproved land (the lot loan) | Only if the lender knows the proceeds will build a dwelling within two years | Section 1003.3(c)(2) and comment 3(c)(2)-1 |
| Any business-purpose loan | Only if it is a home purchase, home improvement or refinancing | Section 1003.3(c)(10) |
| Any loan from a lender that made fewer than 25 closed-end mortgage loans in either of the two preceding years | No | Section 1003.3(c)(11) |
Read together, the rule leaves the two products this page is about on opposite sides of the line. A spec builder's construction-only loan is excluded outright. A build-to-rent loan is reported or not depending on its structure: a single-close loan that rolls into the permanent rental loan is in, a two-close loan (a build loan, then a separate rental loan) is out. The official interpretation's own example of a short loan that is in is a nine-month flip loan, and it adds that such a transaction “is not temporary financing” merely because its term is short; that is why flip loans reach HMDA and ground-up loans mostly do not. How a given lender classifies each loan is its own call.
One field trips people up. HMDA has a construction_method value, and it sounds like it flags construction loans. It does not: it records whether the dwelling is site-built or a manufactured home, and modular homes and prefabricated components assembled on site are reported as site-built. In the seven-state 2025 files we read, 1,277 of 192,236 originated investor business-purpose loans (0.66%) were coded manufactured home. HMDA has no field that says a loan financed construction, so the loan_purpose and loan_term fields are all a researcher has, and they cannot separate a flip from a build.
What the lenders say (their claims, October 8, 2026)
These are the terms on each lender's own construction page, saved on October 8, 2026. They are lender claims about a starting point, not what borrowers received.
Ground-up construction terms published by six lenders on October 8, 2026
| Lender | Starting rate | Max loan to cost / to ARV | Term | Loan size | Minimum FICO | Fees and prepayment as stated | Experience as stated |
|---|---|---|---|---|---|---|---|
| Kiavi | “Rates as low as 9.00%” | 85% of total costs / 70% of ARV | 12, 18, 24 months, 3 or 6 month extension options | $150K to $10MM | Not stated | “low origination fees” (no figure); no application fee; FAQ says no prepayment penalties; no appraisal required | Not stated |
| Lima One Capital | Not on the product page | 90% / 75% | 19 and 24 months | $100K to $5M | Not stated | Interest-only, paying only on drawn funds; fees not stated | Fix-and-flip experience can be used to qualify |
| RCN Capital | Starting at 9.84% | 90% / 75% for 10 or more ground-up projects; 85% / 65% for none | 12 to 24 months | $100K to $2M | 650 | Not stated | Leverage tiers by ground-up projects completed in the last 3 years |
| Easy Street Capital | 8.90% in its terms box; 9.90% in its FAQ | 90% / 75% | 9 to 24 months | $75K to $5M+ | 680 | FAQ: zero to two points and a $1,995 document fee; no prepayment penalty | Lists a first-time builder product |
| Center Street Lending | As low as 9.00% | Up to 90% / not shown | 6 to 24 months (typically 12 to 18) | $200K to $10MM | 680 | Fees not stated; two most recent months of bank statements | Not stated |
| LendingOne | 9.95% in its own comparison example | 90% / 70% | 12 to 24 months | Up to $40M | Not stated | Its example shows a 1.50% origination fee | At least one ground-up project in the past 36 months |
Three things the table shows. First, the headline rates cluster within about a point of each other (8.90% to 9.84%, with LendingOne's 9.95% a worked example rather than a floor), so on rate alone the lenders look alike, which is why leverage, draw mechanics and fees decide the deal. Second, two pages contradict themselves or a sibling page: Easy Street's terms box says 8.90% but its FAQ on the same page says “starting at 9.90%”, and Lima One's product page lists 19 and 24 month terms while an older Lima One blog post on its site (updated July 2024) lists 13, 18 and 24 months and a 70% loan-to-ARV limit against the product page's 75%; we use the product page. Third, the silences matter more than the numbers. None of the six construction pages says whether the loan is recourse or requires a personal guarantee, none states a draw or inspection fee, and none states an extension fee. Ask for all of them in writing before you pay for an appraisal or a lot.
Anchor Loans also lists ground-up construction for builders of one to four units on its builders page, but it publishes no rate, leverage or term there, so it is not in the table (see our Anchor Loans review). Kiavi's page states a licensing line for its DSCR, rental and bridge loans; it does not say which entity funds a new construction loan, so ask.
Our full reviews cover each lender's record beyond construction: Kiavi, Lima One, RCN Capital, Easy Street Capital, Center Street Lending and LendingOne.
The cap on finished value sets your cash, not the 90% headline
Every lender above states two limits: a share of cost (LTC) and a share of the finished house's value (ARV). You get the lesser of the two. A 90% LTC cap only binds if the house will be worth enough, and the break-even is simple: ARV must be at least the LTC cap divided by the ARV cap, times your all-in cost.
Maximum loan on a $450,000 project at two finished values, from each lender's published caps (our arithmetic)
| Lender (caps) | ARV needed for LTC to bind, as a multiple of cost | Loan if ARV is $600,000 | Cash you bring | Loan if ARV is $520,000 | Cash you bring |
|---|---|---|---|---|---|
| Kiavi (85% / 70%) | 1.214 | $382,500 | $67,500 | $364,000 | $86,000 |
| Lima One (90% / 75%) | 1.200 | $405,000 | $45,000 | $390,000 | $60,000 |
| Easy Street (90% / 75%) | 1.200 | $405,000 | $45,000 | $390,000 | $60,000 |
| LendingOne (90% / 70%) | 1.286 | $405,000 | $45,000 | $364,000 | $86,000 |
| RCN, 10+ projects (90% / 75%) | 1.200 | $405,000 | $45,000 | $390,000 | $60,000 |
| RCN, first project (85% / 65%) | 1.308 | $382,500 | $67,500 | $338,000 | $112,000 |
At a $600,000 finished value (1.33 times cost) the LTC cap binds for all six and the cash you bring is $45,000 to $67,500. At $520,000 (1.16 times cost) the ARV cap binds for all six and the spread widens: an RCN first-project loan is $338,000 and the cash you bring is $112,000, $52,000 more than at Lima One, Easy Street or RCN's top tier (our arithmetic). The same house, the same builder, a $52,000 difference in cash, from a cap most borrowers do not look at until the term sheet. The table simplifies: RCN's grid also limits the initial draw to a share of as-is value, Kiavi measures its 85% against purchase price plus construction costs, and each lender defines cost its own way (land, soft costs, interest reserve), so use it to compare lenders on your numbers, not to predict a quote.
The cost of carrying the loan is smaller than most first-timers fear because interest accrues on drawn funds. LendingOne's own comparison shows $20,149 of 12-month interest on a $405,000 loan at 9.95%; interest on the full balance would be $40,297, so its example assumes about half the loan is outstanding on average (our arithmetic), and its 1.50% origination fee on that loan is $6,075 (our arithmetic). A build that runs long raises the average balance, which is why a lender's extension terms matter more than its rate.
What it costs to build: Census Bureau data
The Census Bureau, with HUD, publishes the only national official count of what is being built and what it costs. The figures below are from its New Residential Construction release of August 18, 2026 and its Characteristics of New Housing for 2025, published July 1, 2026. Both are survey estimates with a margin of error, and the cost series covers contractor-built houses and excludes the lot.
Median contract price of contractor-built single-family houses started, per square foot (Census Bureau)
| Year | Median per sq ft | Average per sq ft | Share of starts at $150 or more per sq ft |
|---|---|---|---|
| 2020 | $124.95 | $138.00 | 32% |
| 2021 | $131.23 | $150.89 | 38% |
| 2022 | $156.93 | $178.32 | 54% |
| 2023 | $163.15 | $182.09 | 58% |
| 2024 | $165.15 | $184.55 | 58% |
| 2025 | $171.57 | $198.33 | 61% |
The median rose 37.3% from 2020 to 2025 and 3.9% from 2024 to 2025 (our arithmetic). By region in 2025 the median was $157.30 in the South, $176.87 in the West, $179.30 in the Northeast and $194.09 in the Midwest. Use it as a reasonableness check on a general contractor's bid: a bid far from your region's number is a reason to ask what is excluded, not proof of anything. The median contract price, not per square foot, is noisier: $400,700 in 2023, $356,200 in 2024 and $404,000 in 2025 (Census says the 2025 relative standard error is 4%), so the per-square-foot series is the steadier one.
Single-family housing units started and completed (Census Bureau, thousands)
| Measure | 2023 | 2024 | 2025 |
|---|---|---|---|
| Single-family started, total | 948 | 1,013 | 940 |
| Single-family started, built for sale | 680 | 742 | 675 |
| Single-family started, contractor built (for the owner) | 123 | 127 | 131 |
| Single-family started, owner built | 55 | 51 | 55 |
| Median floor area of single-family starts (sq ft) | 2,177 | 2,150 | 2,154 |
| Single-family completed, all | 999 | 1,019 | 1,005 |
| Single-family completed, built for rent | 97 | 112 | 105 |
Starts fell 7.2% in 2025 and the built-for-sale subset fell 9.0% (our arithmetic). Quarterly data show 214,000 starts in the first quarter of 2026 (revised) and 253,000 in the second (preliminary), 5.3% below the first half of 2025 (our arithmetic). Built for rent is a smaller and steadier business: 105,000 completions in 2025, 10% of the total by Census's own percent distribution, against 52,000 in 2019, about twice as many (our arithmetic). Census does not publish built-for-rent starts as a separate column in the quarterly table; the footnote says its single-family total covers “single-family units built for rent that are not shown separately”, so completions are the official built-for-rent series. These are national totals; the Census data in this extract has no time-on-market, construction-loan or builder-profit figure, so they tell you what is being built and its cost, not whether your spec house will sell.
What HMDA shows for lenders that do construction
HMDA cannot isolate the ground-up loan, but it does show what the same lenders report for the loans it can see, and it shows how little of their business is visible. We read the 2025 originated conventional loan files for seven states that we had cached from the FFIEC Data Browser (California, Georgia, New Jersey, Ohio, Pennsylvania, Florida and Texas) and kept investment-property loans made for a business or commercial purpose. That is 192,236 loans, of which 34,473 (17.9%) had a term of 36 months or less. By purpose, 104,936 were coded home purchase, 44,783 cash-out refinancing, 30,091 refinancing, 6,220 home improvement and 5,473 other purpose. Last year's loans, not today's.
Lenders with a ground-up page, in seven states' 2025 HMDA files (investor business-purpose loans)
| Lender | Loans | Dollars | Median term | Share 36 months or less | Median note rate | Loan purpose as coded |
|---|---|---|---|---|---|---|
| Kiavi Funding | 13,324 | $4.81 billion | 12 months | 78.5% | 9.95% | 10,160 home purchase, 3,164 refinancing |
| Easy Street Capital | 1,784 | $678 million | 6 months | 100% | 9.9% | All 1,784 other purpose |
| Anchor Loans | 826 | $1.20 billion | 12 months | 99.9% | 9.75% | 582 home purchase, 244 refinancing |
| Lima One Capital | 826 | $345 million | 19 months | 55.2% | 8.9% | 391 home purchase, 251 cash-out refinancing, 184 refinancing |
| RCN Capital (two filers) | 2,960 | $672 million | 360 months | 39.3% | 8.04% | 1,496 home purchase, 1,123 other purpose, 334 refinancing |
| LendingOne | 1,150 | $731 million | 360 months | 35.7% | 7.48% | 463 home purchase, 460 cash-out refinancing, 157 refinancing, 70 home improvement |
Three readings, none of which is a statement about construction. First, the medians mix products: Kiavi, Easy Street and Anchor are almost all short-term loans, while RCN and LendingOne's 360-month medians come from their long-term rental loans, so a lender's median says little about its ground-up pricing. Second, Easy Street's loans are all coded “other purpose” and Kiavi's “home purchase” or refinancing; nothing in the file says which loans financed construction, and the reporting classification is the lender's. Third, not every lender is visible: the one Center Street entity on the 2025 FFIEC filer list (Center Street Lending VIII, LLC) has no originated loans in these seven files, although Center Street advertises ground-up loans. For comparison, our Anchor Loans review shows the same gap from Anchor's side, with HMDA capturing only part of the volume it reports having originated.
Spec for sale or build to rent: the exit changes the loan
The two strategies need different exits, and the loan structure follows.
- Spec for sale. The exit is the sale, so the loan needs to last through construction plus the time to sell. Kiavi, LendingOne and Lima One all pitch spec builds; terms of 12 to 24 months and extension options of 3 or 6 months (Kiavi) are the buffer. A finished, unsold house is a separate risk: Lima One lists a Bridge Plus loan “for new construction financing on completed new home inventory,” up to 80% LTV with no prepayment penalty, as the product for it.
- Build to rent. The exit is a 30-year rental loan, so you choose between one closing and two. Kiavi's page says its loans offer “single or dual closes”; Lima One's Build2Rent is a “Two-close loan program (one for the build, one for the rental)”; LendingOne markets a build-to-rent line for institutional borrowers. Under Regulation C the two-close version is excluded from HMDA and the single-close version is not, so the federal data will show the permanent rental loan and not the construction loan that preceded it. Our DSCR lender comparison and BRRRR method page cover what you refinance into. If you plan to hold several finished houses together, see blanket loans.
Built-for-rent homes were about one in ten single-family completions in 2025 (Census), so the buyer of your finished product, or the lender who takes it out, is a market of its own, not the whole.
What you can do with this
- Divide your expected ARV by your all-in cost first. If the ratio is below 1.2, no lender above gives you its headline leverage; if it is between 1.2 and 1.3, the lenders with a 70% or 65% ARV cap (Kiavi, LendingOne, an RCN first project) give you less than the ones with 75% (our arithmetic). Run both caps on your own numbers before you pick a lender on its LTC.
- Ask for what the pages leave out, in writing. Whether the loan is recourse or needs a personal guarantee; points, document fee, draw and inspection fees; the extension fee and how many extensions; whether cost includes land, soft costs and an interest reserve; and what happens if the build runs past maturity.
- Check your contractor's bid against the Census range for your region. A median of $171.57 a square foot nationally, $157.30 in the South and $194.09 in the Midwest (2025, contractor-built, lot excluded) is a floor for questions, not a price.
- Decide spec or hold before you apply. A hold plan changes the loan: single close, dual close or two separate loans. Lima One's Build2Rent is two closes; Kiavi's page says single or dual.
- Qualify honestly. RCN, LendingOne and Easy Street tie leverage or eligibility to completed ground-up projects (RCN tiers; LendingOne requires one in the past 36 months; Easy Street lists a first-time builder product). Tell the lender what you have built and ask which tier you land in.
Kiavi pays us a referral fee when a loan closes through its button in the box below. Everything above, including the lender table, is the same either way, and Kiavi's 85% and 70% caps are lower than the 90% and 75% several others publish. Kiavi's page says it needs no appraisal to close and no permits before closing, which is the reason some builders look at it first; ask which entity funds the loan. Lima One and RCN are in the box because their pages publish the most detail on ground-up leverage.
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FAQ
Sources: lender terms from the construction pages of Kiavi, Lima One Capital, RCN Capital, Easy Street Capital, Center Street Lending, LendingOne and Anchor Loans, saved October 8, 2026 (lender claims); Regulation C, 12 CFR Part 1003 and Supplement I, from eCFR (version of October 1, 2026, read October 8, 2026); Census Bureau and HUD, New Residential Construction, August 18, 2026 release (Table Q1), and Census Bureau Characteristics of New Housing 2025, published July 1, 2026 (type of financing, contract price, contract price per square foot); loan-level data from the FFIEC HMDA Data Browser, 2025 originated conventional loans for California, Georgia, New Jersey, Ohio, Pennsylvania, Florida and Texas (our script hmda_ground_up_coverage.py and its output are in sources/); lender names from the FFIEC 2025 filer list; keyword demand from DataForSEO, October 8, 2026. All percentages, differences, maximum-loan figures and break-even ratios are our arithmetic. This is analysis of public records, not investment, legal, lending or tax advice.
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