Construction loans are among the riskiest – yet most lucrative – loans in the small business sector. But when the housing bubble collapsed in 2008, most lenders ceased construction lending activity.

But as the economy improves, there has been a marked increase in construction volume, thus leading more business owners and their lenders to begin considering new construction projects – and lending opportunities for financial institutions.

This training event explains key risk elements that must be considered when underwriting construction loans to ensure potential problems are recognized and managed, and that profitable results will follow.

The discussion will include the best practices for managing commercial construction lending, including discussion of policies, underwriting mandates, closing, fund control, and the steps to managing the process.

Learning Objectives

By attending this training session, you will learn:

• Unique dynamics that distinguish construction loans from most other types of lending
• Additional risks that are encountered in construction loans
• Policy issues that will shape the future risk and rewards of these loans
• Why constructions should never start project ahead of loan closing
• How the bank protects itself with plans and specs
• Best practices in construction contracts to protect bank &borrower
• Builder terms that should never be allowed by lender
• How to determine if builder is qualified for managing the project
• Lender's most important construction management task: Fund Control
• Project costs, cost overruns, change orders and all the fun in between
• The importance and role of construction plan review consultants
• Proactive suggestions about project insurance
• Loan draws, inspections and interest reserves – how to never get burned on either
• SBA loans? How can SBA can change approach to construction lending

About Your Speaker

Charles Green is a seasoned finance professional with more than 35 years’ experience of advising, financing, and investing in the small business sector. He has broad banking experience, ranging from analyst to administrator to business developer to team leader to eventually become the Founder and President/CEO of Sunrise Bank of Atlanta.

Charles has trained commercial lenders across the country through several schools, including the ABA’s Graduate Commercial Lending School, Stonier Graduate School of Banking, and the Graduate School of Banking at Wisconsin. He also has authored several books about business financing, including Banker’s Guide to New Small Business Finance, The SBA Loan Book, 3rd Edition, and Get Financing Now. He earned a B.S. Finance from the University of Alabama, completed the Stonier National Graduate School of Banking, and Executive Education at Harvard Business School.