myCPE
myCPE

Evaluating, Underwriting, and Monitoring Construction Loans 1.5 Credits

Oct 28, 2024, 03:30 PM ET

Evaluating, Underwriting, and Monitoring Construction Loans 1.5 Credits

Construction Lending and Real Estate Credit Administration

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Oct 28, 2024, 03:30 PM ET

Learning Objective

  • To analyze how to mitigate the higher risk.
  • To analyze how to extend construction loans safely and profitably.
  • To discuss construction lending policy—defining a construction loan, outlining necessary information and documentation needed to evaluate construction loan, and monitoring loan performance.
  • To explain appropriate underwriting and structuring—LTV, LTC, minimum equity, bonding, etc.
  • To inspect the role and activities of real estate construction administration (RECAD)—sources & uses, costs review, inspections, disbursements, retention, liens, and construction problem mitigation.

Course Overview

Most bankers acknowledge that construction lending is riskier than other types of commercial lending. Its repayment ability depends on the successful completion of the construction before the project can generate cash flow from the sale of the finished property, from rental or lease of the real estate, or permanent take-out refinancing. Moreover, during the construction period, the collateral is a work in progress, and often the guarantors do not have sufficient outside net worth or income to pay off the loan.

Key topics covered in this CPE Finance course are:

  • Learning how to evaluate the developer’s ability to repay the construction loan: Developer’s background and expertise, Contractor’s background and expertise, Developer’s legal structure, Owner’s minimum equity, Repayment ability from project cash flow, collateral, and guarantees.
  • Develop an appropriate underwriting of the construction project to ensure the resulting structure ensures the bank will be repaid in full, on time, and as agreed: Sources and uses, cost review of hard costs & soft costs, appraisal review, LTV, LTC, DCR, Interest reserves, and Bonding.
  • Explain how to satisfactorily monitor and manage credit exposure and construction activity: Role of and activities performed by real estate construction administration (RECAD), Inspections and disbursements, Reallocations and change orders, Retention, punch lists, charge-backs, Causes of and cures for construction problems, and Problem asset management of construction loans. 

Join this CPE webinar by Dev Strischek to understand everything about construction lending and real estate credit administration!

Podcast Credits

Short Video Credits

On Demand Credits

Live Credits

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Additional Information

Credits

1.5

Course Level

Basic

Instructional Method

QAS Self Study
Group Internet Based

Pre-requisites

None

Advance Preparation

None

NASBA APPROVED

MY-CPE LLC, 1600 Highway 6 south, suite 250, sugar land, TX, 77478

MY-CPE LLC (Sponsor Id#: 143597) is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit. Complaints regarding registered sponsors may be submitted to the National Registry of CPE Sponsors.

About Instructor

Dev Strischek
Dev Strischek

Principal, Devon Risk Advisory Group, LLC

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A frequent speaker, instructor, advisor and writer on credit risk and commercial banking topics and issues, Dev is principal of Devon Risk Advisory Group and engages in consulting, speaking and training on a wide range of risk, credit, and lending topics. As former SVP and senior credit policy officer at SunTrust Bank, Atlanta, he was responsible for developing, implementing, and administering credit policies for SunTrust's wholesale lines of business--commercial, commercial real estate, corporate investment banking, capital markets, business banking and private wealth management. He also spent three years as managing director and credit approver in SunTrust's Florida commercial lending and corporate investment banking areas, respectively. Prior to SunTrust, Dev was chief credit officer for Barnett Bank's Palm Beach region. Besides stints at other banks in Florida, Kansas City, and Ohio, Dev's experiences outside of banking include CFO of a Honolulu construction company, combat engineer officer in the U.S. Army, and college economics instructor in Hawaii, Missouri, and Florida. A graduate of Ohio State University and the ABA Stonier Graduate School of Banking, he earned his M.B.A. from the University of Hawaii.

Dev serves as an instructor at the Stonier Graduate School of Banking, the Southwestern Graduate School of Banking, and the American Bankers Association's (ABA) Commercial Lending School. His school, conference, and workshop audiences have included participants drawn from the ABA, RMA, OCC, Federal Reserve, FDIC, FFIEC, SBA, the Institute of Management Accountants (IMA) and the AICPA.  He worked with RMA to develop, implement, and teach its Critical Thinking course.

Dev has written about credit risk management, financial analysis and related subjects for the ABA's Commercial Insights, the Risk Management Association's RMA Journal, the IMA’s Strategic Finance and other business professional journals. He is the author of Analyzing Construction Contractors and its related RMA workshop. A past national chair of RMA and former Florida Chapter president, Dev serves as a member of the RMA Journal's advisory board.  He represented the banking industry as a member of the Financial Accounting Standards Board’s Private Company Council, which reviews and recommends changes to existing and proposed generally accepted accounting principles that make them more cost-effective for privately held companies.  Finally, he has consulted on credit risk issues with banks in Morocco, Egypt, and Angola through the US State Department's Financial Service Volunteer Corps (FSVC).

On Demand FAQs

What is Self Study (QAS)?

Self Study QAS (Quality Assurance Service) is a NASBA and other regulatory bodies approved program designed for Professionals to complete their Continuing Professional Education credits through self-paced, interactive courses that meet the highest standards of quality and compliance. We are approved by NASBA, IRS, CFP Board, HRCI, SHRM, Payroll Org, FP Canada, and 25+ other regulatory bodies.

How do I earn CPE credits through self-study?

To earn CPE credits, you must complete the self-study course, pass the required assessments, and submit the necessary documentation. Credits are awarded based on the completion of course hours and successfully passing the assessments.

Are the self-study courses approved by NASBA and other regulatory bodies?

Yes, all our self-study courses are approved by NASBA, IRS, CFP Board, HRCI, SHRM, Payroll Org, FP Canada, and 25+ other regulatory bodies, ensuring they meet the rigorous standards for quality and educational content set by these organizations.

What are the requirements to maintain compliance with self-study courses?

To maintain compliance, you must follow the guidelines set by NASBA and other regulatory bodies, which include completing the course within the specified timeframe, passing the assessments, and keeping accurate records of your learning activities.

How can I access my course completion certificates?

After successfully completing a self-study course and passing the assessments, you can access and download your course completion certificates from your account dashboard on our platform. These certificates are recognized by NASBA, IRS, CFP Board, HRCI, SHRM, Payroll Org, FP Canada, and 25+ other regulatory bodies for compliance and reporting purposes.

How are credits reported to governing bodies?

We issue instant credit certificates, ensuring they are valid for presentation to governing bodies. Typically, we report IRS, CTEC, CFP, IDFP, IWI, VBOA Ethics credits within 7 days – the fastest in the industry.

Live Webinar FAQs

What is a Live Webinar Group Internet-Based Credit?

A Live Webinar Group Internet-Based Credit is an interactive, real-time online seminar where professionals can earn Continuing Education credits by participating in live sessions led by experts in various fields. These sessions meet the standards set by NASBA, IRS, CFP Board, HRCI, SHRM, Payroll Org, FP Canada, and 25+ other regulatory bodies.

How do I earn credits through live webinars?

To earn credits, you must attend the entire live webinar, actively participate in any polls or questions, and complete any required evaluations or assessments. Credits are awarded based on your attendance and participation in the live session.

Are the live webinars approved by NASBA and other regulatory bodies?

Yes, all our live webinars are approved by NASBA, IRS, CFP Board, HRCI, SHRM, Payroll Org, FP Canada, and 25+ other regulatory bodies, ensuring they meet the high standards for quality, interactivity, and educational content set by these organizations.

What are the requirements to maintain compliance with live webinar courses?

To maintain compliance, you must adhere to the guidelines set by NASBA and other regulatory bodies, which include attending the full duration of the webinar, participating in interactive elements, and completing any post-webinar evaluations or assessments.

How can I access my webinar completion certificates?

After successfully attending a live webinar and fulfilling all participation requirements, you can access and download your completion certificates from your account dashboard on our platform. These certificates are recognized by NASBA, IRS, CFP Board, HRCI, SHRM, Payroll Org, FP Canada, and 25+ other regulatory bodies for compliance and reporting purposes.

How are credits reported to governing bodies?

We issue instant credit certificates, ensuring they are valid for presentation to governing bodies. Typically, we report IRS, CTEC, CFP, IDFP, IWI, VBOA Ethics credits within 7 days – the fastest in the industry.

Reviews and Ratings

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RP

Ruth Pukini, CPA (US)

This course was great as someone that wants to pursue real estate investing

CN

Cheryl Nuzzolo, CPA (US)

Great info and instructor. Learned info re construction loans.

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