LLC ownes land and constructs condo units. In this state an individual can not own a condo until construction is completed. Before construction begins LLC sells interest to prospective condo unit owners. At the end of constriuction the individual condo units are deeded to individuals. Individuals are required to fund the land purchase and construction through LLC contributions--by cash of bank financing setup through the LLC with personal guaranty of unit owner. In effect each prospective unit owner is paying for the construction of his unit without receiving unit may be rental property or first or second home. What type of interest is this that is paid on the loan during this pre-ownership period?
Thanks...jcs
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