Residential Construction Lending

Monday, August 15, 2022
2:30 pm – 4:30 pm Eastern

Many problems can occur during construction that can leave lenders highly exposed unless they are underwritten properly.

Community Banks are often faced with construction loan requests that are underwritten by Consumer and Commercial Lenders who apply the same underwriting standards used for retail and commercial loans to Residential Construction Loans. The problem with this approach is that Construction Lending is a highly specialized form of lending requiring a different approach. It is actually Asset-Based Lending, whereby funds are advanced based on the successful completion of various phases of the project and other requirements being met. Many problems can occur during construction that can leave lenders highly exposed unless they are underwritten properly. Understanding the risks in this type of lending is paramount for bankers. This course is designed to provide fundamental and proven techniques to minimize these risks. Common types of borrowers of Residential Construction Loans are: • Individuals constructing their single family residences (Owner/Occupant) • Developers who transform raw land into improved property suitable for construction • Builders of 1-4 family residences We will examine the characteristics and risks inherent with these borrowers; how to underwrite them and the real estate project under construction. Our primary focus will be on financing the construction of single-family residential housing.

What You Will Learn:

• Prerequisites for Successful Construction Lending
• Analyzing and Underwriting the Owner/Occupant
• Analyzing and Underwriting the Builder/Developer
• Structuring the Construction Loan
• Managing Construction Loan Advances
• Financing Land Acquisition and Land Development
• Construction Lending Documentation
• Problem Areas in Construction Lending

Who Should Attend? 

Loan Officers, Senior Credit Officers, Senior Loan Officers, Loan Administrators, Loan Review Officers, Compliance Officers, Branch Managers, Credit Analysts and Underwriters.

Instructor

Jeffery W. Johnson 

Jeffery W. Johnson started his career with SunTrust Bank in Atlanta as a Management Trainee and progressed to Vice President and Senior Lender of SouthTrust Bank and Senior Vice President and Commercial Banking Division Manager for Citizens Trust Bank of Atlanta.

Most of his career has been spent in Credit Administration, Lending, Business Development, Loan Review, Management and Training & Development. He has managed loan portfolios representing a cross section of loan types including: Large Corporate, High Net Worth Individual, Middle Market Companies, Small Business, Real Estate and Non-Profit Organizations.

Mr. Johnson is now a training professional in the financial industry by leading various seminars covering important topics relating to issues in financial institutions. He teaches actively for fifteen state banking associations in the United States, Risk Management Association (RMA) and individual financial institutions nationwide. He co-authored a training course entitled "Lending to Service and Other Professional Organizations" for RMA in 2001.

Mr. Johnson earned a B.A. Degree in Accounting from Morehouse College in Atlanta; a MBA in Finance from John Carroll University in University Heights, Ohio; Banking diploma from Prochnow School of Banking at the University of Wisconsin and a Graduate Certificate in Bank Management from the Wharton School of Business at the University of Pennsylvania.

Attendance verification for CE credits provided upon request.

Webinar Sponsored by OnCourse Learning (Total Training Solutions)

If you are having issues with registering online, please contact CBAO's Education, Training & Special Event Coordinator, Malia Widder, (614) 610-1877.