Yes. A private lender can finance a planned unit development in two stages: a bridge loan on the subdivided lots, then a construction loan for each 1 to 4 unit home as you build. At Clion Capital, new construction rates start as low as 9.25%, and we underwrite each phase on its own merits.
Why Do Banks Struggle With PUD Deals?
A PUD changes shape during the loan. It starts as raw or subdivided land, becomes partially built homes, then finished homes sold one at a time. Most bank templates are built for one finished house, not collateral that moves.
Bank credit for builders has also been tight. In NAHB’s Q2 2026 survey, builders reported the eighteenth straight quarter of tighter credit, and 53% of those affected said lenders demanded personal guarantees or outside collateral (eyeonhousing.org). The deal is fine. The box is wrong.
How Does Two-Stage PUD Financing Work?
| Stage | Loan | What it covers | How it is repaid |
|---|---|---|---|
| 1. Lots | Bridge loan | Purchase or refinance of subdivided, approved lots | Released lot by lot as construction loans close |
| 2. Homes | Construction loan | Vertical build of each 1 to 4 unit home, paid in draws | Sale of the home or refinance into a rental loan |
Splitting the deal this way lets you start building on the first lots while the rest of the land is still financed. You do not need to fund every home at once.
What Does It Cost?
Land and construction money is expensive everywhere right now. NAHB reported average effective rates in Q2 2026 of 10.43% for land acquisition, 12.59% for land development and 11.82% for speculative single-family construction (eyeonhousing.org).
Our new construction rates start as low as 9.25%, with origination from 1.00% and a $999 underwriting fee. For context, the average 30-year fixed rate for primary homes was 7.32% on October 22, 2026 (freddiemac.com), which is the rate many of your end buyers will be paying.
What Does a Real PUD Deal Look Like?
Here is an illustrative six-lot project.
- Six approved lots at $90,000 each: $540,000 of land.
- A bridge loan funds the lots while you finish site work and permits.
- Each home costs $350,000 to build. A construction loan funds each one in draws, starting with two homes.
- As homes sell, the sale proceeds repay that home’s construction loan and release the next lot.
Demand from investors helps the exit, too. Investors bought 27% of U.S. single-family homes from March to June 2026 (cotality.com), so finished homes can sell to owner-occupants or to buy-and-hold investors. Build in phases. Sell in phases.
What Do You Need to Apply?
- Recorded plat or approved subdivision plan.
- Lot purchase price or current value, and site work status.
- Plans, specs and a line-item construction budget for the first homes.
- Builder resume and completed projects.
- Sales comps or a rental plan for the exit.
We fund up to 92.5% of cost on qualifying construction projects and complete draw inspections within 24 hours. Read how draw schedules work, how to refinance a finished build and how bridge loans compare with rental loans, then get your rate at apply.clioncapital.com.
Frequently Asked Questions
What is a planned unit development?
A planned unit development is a subdivided community of homes, often with shared areas managed by an association. Each lot is owned separately, so each home can be financed and sold on its own.
Can I get one loan for both the lots and the homes?
Usually the deal is split: a bridge loan on the lots and a construction loan on each home. That lets you start building without financing every home at once.
What PUD properties does Clion Capital finance?
We finance 1 to 4 unit homes in planned unit developments, including vacant lot bridge loans and vertical construction loans.
What are new construction loan rates in 2026?
NAHB reported an average effective rate of 11.82% on speculative single-family construction loans in Q2 2026. Clion Capital new construction rates start as low as 9.25%.
Do I need tax returns to finance a PUD project?
No. Clion Capital uses asset-based underwriting with no income verification. The project, the budget, your experience and the exit drive the decision.
Last updated October 27, 2026.
Sources and References
- NAHB Eye on Housing: Cost of Credit for Builders Up Since the End of 2025 (AD&C Survey, Q2 2026)
- Freddie Mac: Primary Mortgage Market Survey
- Cotality: Investor Report, Q2 2026
- Clion Capital: new construction and bridge loans
About the Author
Clion Capital is a direct private lender for professional real estate investors, offering fix-and-flip, bridge, new construction and DSCR rental loans. Our principals work directly with every borrower, and 70% of our business comes from repeat clients. See your rate instantly at apply.clioncapital.com or learn more about Clion Capital.