# Draft Loan Agreement > Guides drafting of a construction-to-mini-perm loan agreement by reconciling economic terms across source materials and producing both the loan agreement and a cover memo flagging material inconsistencies with proposed resolutions. - Skill: `finchipaiorg/draft-loan-agreement` (Agent Skill) - Install (CLI): `npx skillmds@latest add finchipaiorg/draft-loan-agreement` - Raw SKILL.md: https://api.skillmd.com/api/skills/finchipaiorg/draft-loan-agreement/raw - Safety review: pending - Works with: Claude Code, Claude.ai, OpenAI Codex - Category: Coding & Dev Tools - Author: FinchipAIOrg (https://skillmd.com/u/finchipaiorg) - Updated: 2026-09-22 - Page: https://skillmd.com/skills/finchipaiorg/draft-loan-agreement --- # Skill: Draft Commercial Real Estate Construction Loan Agreement for Mixed-Use Development ## 2. Failure modes the skill is correcting - Drafting from the term sheet alone and missing qualifications, exceptions, or conditions stated in the credit memo, appraisal, title materials, environmental report, organizational materials, or draw schedule. - Carrying forward economic terms without reconciling them against the project budget, timing assumptions, and draw mechanics, which can make the facility internally inconsistent at closing or during funding. - Treating construction disbursement mechanics as boilerplate and failing to align advances, reserve funding, retainage, and completion conditions with the actual project cash flow. - Omitting the separate cover memorandum that must identify cross-document conflicts and recommend a resolution path. - Misstating the borrower’s entity structure, signatory authority, guarantor posture, or SPE covenants because the draft was not tested against the organization materials. - Ignoring title, environmental, or appraisal exceptions that affect closing deliverability, lien priority, or underwriting assumptions. - Drafting a mini-perm conversion structure without specifying the operational test, measurement period, and conversion conditions that govern the post-construction phase. ## 3. Legal frameworks / domain conventions that apply - Construction-to-mini-perm structure: the agreement should bridge a development-period facility into a stabilized permanent phase, with clear conversion conditions, maturity mechanics, and post-conversion amortization or extension terms. - Loan economics: principal amount, advance mechanics, interest rate, reserve accounts, fees, maturities, extension rights, and any rate-fallback language must be harmonized across the source set before drafting. - Draw administration: advances ordinarily depend on lender inspection, architect certification, lien waivers, no-default certificates, and budget compliance; the draw schedule should track the approved uses and timing assumptions. - Reserve and retainage mechanics: interest reserve, contingency reserve, and contractor retainage should be drafted to match the construction budget and funding cadence reflected in the source documents. - Completion support: if a completion guaranty or cost-overrun support is contemplated, the obligor, trigger, and scope of recourse should match the transaction materials and the borrower structure. - SPE and authority covenants: the borrower should be described consistently with its organizational documents, ownership chart, and authorization evidence; governance restrictions should track the intended single-purpose structure. - Title and lien priority: the mortgage and related collateral package should be drafted for first-priority secured status subject only to permitted exceptions, with open title issues flagged for cure or endorsement. - Environmental diligence: disclosed environmental conditions should be reflected in the indemnity, closing conditions, and any further investigation or remediation obligations. - Appraisal and underwriting metrics: valuation, leverage, and stabilized-value assumptions should be checked against the debt sizing and closing conditions; any mismatch should be called out rather than silently normalized. - Governing legal authorities: use the controlling local real-property, lending, recording, and environmental disclosure framework reflected in the source set; where the materials reference a statute, regulation, rule, or industry standard, carry that authority forward by name and section. ## 4. Analytical scaffolds - Assemble a term matrix covering borrower, property, collateral, principal amount, pricing, reserves, maturity, extension rights, conversion conditions, and default triggers; compare each item across every source document before drafting operative text. - Read the draw schedule alongside the budget and funding assumptions; test whether the reserve structure, holdbacks, and advance conditions can support the projected disbursement path without a funding gap. - Compare underwriting metrics in the appraisal and credit memo against the proposed loan sizing and collateral package; identify where the draft should preserve a condition, limitation, or disclosure rather than assume consistency. - Review the organizational chart and authorizing resolutions together; identify the legal borrower, equity owner, guarantor, and signatory chain; draft entity and authority provisions to fit that structure rather than a generic template. - Review the title commitment, survey-related references if present, and any listed exceptions; determine which items should be cured, subordinated, insured over, or expressly permitted. - Review the environmental report for recognized conditions, historical use concerns, or recommended follow-up; convert those findings into conditions precedent, representations, indemnities, and post-closing covenants as appropriate. - For each cross-document discrepancy, record: the conflict, the controlling source, the legal or drafting consequence, and the proposed fix. - Draft the loan agreement as the primary deliverable first; prepare the cover memorandum only after the draft exists and is complete enough to support issue spotting. - If only one source document addresses a topic, say that it is the lone source for that term and note whether the absence of corroboration should be confirmed before execution. ## 5. Vertical / structural / temporal relationships - Construction period precedes mini-perm conversion: funding conditions, reserve mechanics, and project completion covenants govern the initial phase; stabilized operation tests and extension options govern the post-completion phase. - Draws, inspections, and lien waivers are sequential: each advance should follow certification, with retainage and holdbacks preserved until the conditions for release are met. - Title and environmental issues have closing priority: unresolved exceptions, undisclosed encumbrances, or material environmental concerns can block lien perfection or delay funding. - Organizational authority and completion support interact: if the guarantor, equity holder, and managing party overlap, draft transfer, control, and authority provisions to avoid inconsistency. - Conversion conditions should turn on objective performance metrics and a defined measurement period, not on vague satisfaction standards. ## 6. Output structure conventions - Loan agreement draft: produce a complete operative agreement with conventional real-estate finance articles, schedules, exhibits, and defined terms as needed for the transaction, not a summary of terms. - Cover memorandum: use a conventional issues-and-resolutions format organized by topic or source document pairing; for each item, state the issue, the controlling source, the recommended resolution, the downstream effect if unresolved, and the responsible follow-up. - Keep the draft and memo distinct in tone and purpose: the agreement should read as binding contract language; the memorandum should read as internal advisory analysis. - Preserve internal consistency across definitions, conditions precedent, representations, covenants, events of default, and exhibit references. - Before finalizing, confirm that the loan agreement file is the primary deliverable, is non-empty, and contains operative clauses; confirm that the cover memorandum is also complete and tracks the identified material issues.