Frequently Asked Questions

What is a "Spec" Loan Contractors, builders or developers who are building a home without a guaranteed sale upon the completion of the home is considered to be building for speculation. These builders are speculating that they will earn a profit when they sell the newly construction home. National City has developed a program specifically for these types of projects.

How much can I borrower under the "Spec" Loan Program? The maximum outstanding note balance without an approved buyer to any one builder will not exceed $2,000,000.

How many homes can I build under the "Spec" Loan Program? The maximum number of homes to one builder is four.

What are the maximum loan amounts and the loan-to-value guidelines? The maximum loan-to-value guidelines are: Maximum LTV Maximum CLTV Maximum Loan Amount 80% 80% $650,000 75% 75% $850,000

Who is eligible for the "Spec" Loan Program? The program is designed for established fulltime builders.The builder must have successfully completed at least eight comparable homes in the last two years.Preferably, at least one of these was a spec home.

What information do you require to apply for a "Spec" Loan? You need to provide the following information: Letter of Recommendation from your National City Loan Officer Complete Contractor/Developer Application including Inventory and Status List. Current Financial Statements on Company including Balance Sheet and YTD Profit and Loss Most Recent Three Years Company Tax Returns Most Recent Three Years Personal Tax Returns on all Principals/Guarantors Current, detailed Balance Sheet on all Principals/Guarantors Current Builders License Articles of Incorporation or Partnership Documentation