Billings keeps growing outward, west past Shiloh Road and north across the Heights, and much of that growth is new single-family homes, twin homes and small multi-unit buildings. Building here means planning for a short construction season and a long winter.
In short: LendingStreet finances ground-up construction for 1-8 unit investor projects in Billings and Yellowstone County, including spec homes, build-to-rent houses, twin homes, duplexes, fourplexes and small 5-8 unit buildings. Loans are sized on loan-to-cost with terms set per project, and funds are released through a draw schedule after inspections. Plans, permits, a detailed budget and builder experience are what get a project approved.
The West End has seen the most new subdivisions, with single-family homes, twin homes and townhomes out along Shiloh Road, Grand Avenue and beyond. The northern Heights, toward Lake Elmo and along Bench Boulevard, has newer subdivisions as well. In older parts of the city, infill on vacant or teardown lots can support duplexes and small buildings close to downtown jobs and the hospitals.
Outside city limits, lots in Lockwood, Shepherd, Huntley and the rural areas around Laurel can be cheaper, but may need wells, septic systems and longer utility runs.
Build-to-rent demand comes from the same tenant base as the rest of the city: healthcare workers, energy and refinery staff, and families relocating for work. Newer twin homes and townhomes with garages tend to lease well, since tenants value covered parking through the winter.
A financeable project starts with documentation:
If you already own the lot, tell us what you paid and when; that history and the lot's current value both shape the loan. Builders new to Billings should share completed projects elsewhere, with photos and references.
This example is illustrative and not a quote. A builder buys a lot for $110,000 and plans a fourplex with $780,000 of hard costs and $60,000 of soft costs including design, permits, impact and connection fees. Total cost is $950,000. At 75% loan-to-cost, the loan is $712,500, released through draws.
At completion the fourplex appraises at $1,050,000 and the units lease for $1,650 each, $6,600 in total. A DSCR refinance at 70% LTV, $735,000, pays off the construction loan. Estimated principal and interest is about $5,139, taxes $600 and insurance $260, for a payment of about $5,999 and a DSCR of about 1.10x. The refinance is sized below the maximum to keep the ratio above 1.0x at Billings rent levels.
At 80% leverage, the refinance payment would push the ratio to about 1.0x or below at these rents, so the example keeps leverage lower on both the construction loan and the refinance.
| Draw stage | Share of hard costs | Amount |
|---|---|---|
| Excavation, footings below frost depth, foundation | 17% | $132,600 |
| Framing, roof, windows | 26% | $202,800 |
| Rough mechanical, electrical, plumbing | 19% | $148,200 |
| Insulation, drywall, exterior | 16% | $124,800 |
| Finishes, final and occupancy | 22% | $171,600 |
Foundations need to go below the frost line, and concrete, roofing and exterior work are hardest in winter. A project that breaks ground in late fall may sit for months, accruing interest. Most local builders aim to have foundations in and the structure framed and dried in before winter so interior trades can work through the cold months.
Build weather into your schedule and your interest budget. A realistic timeline is worth more than an optimistic one when the loan term is set per project.
Each draw follows an inspection that confirms the stage is complete. Your builder pays for work in progress and is reimbursed at each draw, so keep working capital available. The construction draw schedule calculator helps you match stages to cash needs. City or county building inspections are separate from our draw inspections.
Plan for a few days between each draw request and funding, and share the draw schedule with subcontractors so payment expectations match.
Soils vary across Billings, and some sites near the Rims or in drainage areas need engineering work. A geotechnical report helps set the foundation design and budget. On the West End, impact and utility connection fees can be meaningful and belong in soft costs. In rural Yellowstone County, wells and septic add cost and approval time.
Snow load and wind requirements also affect roof and framing design. Your engineer and the building department will set those, and they belong in the budget from the start.
Projects without plans or permits, a borrower with no build history and no experienced general contractor, and buildings over 8 units are outside residential construction lending. Larger projects are commercial; see the multifamily page.
If your project is close but missing a piece, such as final plans or utility approvals, tell us where it stands so we can outline what is needed before a loan can move forward.
A spec home on the West End or in the Heights usually exits by sale. Twin homes, duplexes and fourplexes often exit into a DSCR loan once leased. Montana has no transfer tax, which helps a spec builder's sale proceeds. Check the long-term rental tax classification for a build-to-rent property, since it can affect the payment.
For a spec home, check recent sales of new construction in the same subdivision, since resale homes nearby may not reflect what buyers pay for new.
Send the site address, plans, budget, schedule and builder history. Our investor loans are business-purpose loans on non-owner-occupied property. Call (877) 298-1001 or use the form below.
On loan-to-cost, with terms set per project based on plans, budget, builder and exit. Lower leverage is common when the expected rent is moderate relative to the finished value.
Interior work can continue once the structure is closed in. Foundations and exterior work are best done in warmer months.
Through draws after inspections confirm each stage is complete.
Yes. Build-to-rent twin homes, duplexes, fourplexes and small 5-8 unit buildings are eligible.
A track record, or an experienced general contractor, is usually required. Share past projects with addresses, budgets and completion dates.
Yes, with approvals in place. Site costs need to be in the budget.
Sell the property or refinance into a DSCR loan once it is leased.
Not on residential construction, which covers up to 8 units. Larger buildings are commercial loans; see the multifamily page.
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