Construction Loan Extension Agreement Template for England and Wales

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Key Requirements PROMPT example:

Construction Loan Extension Agreement

"I need a Construction Loan Extension Agreement to extend our existing £5 million construction loan for an additional 18 months until March 2025, with revised milestone dates and an increased interest rate of 0.5% to reflect current market conditions."

Document background
The Construction Loan Extension Agreement is utilized when a construction project requires additional time beyond the original loan term for completion. This document, governed by English and Welsh law, extends the maturity date of the existing construction loan while potentially modifying other terms such as interest rates, payment schedules, and security arrangements. It's particularly relevant when construction delays, market conditions, or other circumstances necessitate an extension of the original financing arrangement. The agreement ensures legal continuity of the financing while protecting both lender and borrower interests under UK financial regulations.
Suggested Sections

1. Parties: Identification of lender, borrower, and any guarantors

2. Background: Details of original loan agreement and reasons for extension

3. Definitions: Key terms used throughout the agreement

4. Extension Terms: Specific details of the loan extension including new maturity date

5. Payment Terms: Modified payment schedule and interest rates

6. Security Provisions: Confirmation of existing security arrangements

7. Conditions Precedent: Conditions that must be met before extension becomes effective

Optional Sections

1. Additional Security: New security requirements - include when additional security is required for the extension

2. Fee Provisions: Details of any extension fees - include when fees are charged for the extension

3. Construction Milestones: Updated construction timeline and requirements - include when original construction schedule needs modification

Suggested Schedules

1. Schedule 1 - Original Loan Agreement: Copy or summary of the original loan agreement

2. Schedule 2 - Updated Payment Schedule: Revised payment dates and amounts

3. Schedule 3 - Construction Timeline: Updated construction milestones and completion dates

4. Appendix A - Property Details: Details of the property under construction

5. Appendix B - Security Documentation: Copies of security documents and amendments

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions
Relevant Industries
Relevant Teams
Relevant Roles
Industries

Law of Property Act 1925: Fundamental legislation governing real property in England and Wales, particularly relevant for security interests in real property and requirements for legal mortgages

Consumer Credit Act 1974: Legislation governing consumer credit arrangements, including consumer protection provisions and disclosure requirements for lending

Financial Services and Markets Act 2000: Primary legislation establishing the regulatory framework for financial services and requirements for regulated lending activities in the UK

Limitation Act 1980: Sets out the time limits for enforcing loan agreements and various limitation periods for different types of claims

Housing Grants, Construction and Regeneration Act 1996: Construction-specific legislation covering payment provisions and adjudication rights in construction contracts

Construction (Design and Management) Regulations 2015: Regulations governing health and safety requirements and project management obligations in construction projects

FCA Regulations: Financial Conduct Authority regulations covering conduct of business rules and fair treatment of customers in financial services

Building Regulations 2010: Statutory instruments that ensure building works meet required standards and have necessary planning permissions

Companies Act 2006: Primary legislation governing company law in the UK, relevant when dealing with corporate borrowers

Insolvency Act 1986: Legislation dealing with corporate and personal insolvency, relevant for default scenarios and creditor rights

Money Laundering Regulations 2017: Regulations implementing anti-money laundering requirements and due diligence procedures for financial transactions

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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