We have an insider wanting to build a new home. We have his current home financed for $190M. He has a debt on rental property with us of $75M and the new debt proposed (construction to be rolled into perm) will be $221.5M.
His current home is under contract but doesn't close until Dec. 1, 2002. "A residence" is an exception under the loan limits for insiders. The reg doesn't state this exception applies to "the residence" or the "primary residence" of the insider.
If we start construction now, would both "residence" loans be combined for an unlimited amount (allowing for legal lending limits) or would one kick into the $100M cap?
I am inclined to believe that the bridge period is OK, but would be more comfortable with a cite.
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AndyZ CRCM
My opinions are not necessarily my employers.
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Rules and Regs minus Relationships equals Resentment and Rebellion. John Maxwell