Development finance is a short-term loan that provides the funds to pay for the building, upgrading and refurbishment costs associated with property development projects.

These loans will have repayment terms geared to the projected build time of the project, usually for between 6-18 months but can be longer.

Depending on the type of project, the loan funding may be issued in stages that suit the build plan. This keeps the repayment costs to a minimum.

There are a wide range of lenders who offer development finance, ranging from the high street banks through to specialist lenders whose names are not so well known. In the same way as you would apply for a normal residential mortgage, you could approach one of the high street banks and apply for a loan. However, as with mortgages, this would limit your choice of finance to that lenders own products with the likely result that the deal that you obtain would not be best for your project.

Obtaining the best deals available on the market will usually mean contacting a broker who specialises in these loans and who will have sound knowledge of a  wide range of lenders products and their lending criteria. This will save you time and ensure that you get the best deals that are available to suit your project.

Our brokers are highly experienced in these types of loans and once you complete the simple enquiry form, will quickly be in touch to guide you on the best way forward.

• Rates from 5.15% per annum
• 100% of build cost available
• Available up to 70% of the Gross Development Value
• 100% Joint Venture Funding
• Interest only charged on funds drawn
• Open to individuals and corporate structures
• Exit facilities available
• Specialist Relationship support with your own dedicated specialist advisor

With new build projects, development finance can often be obtained to finance both the land purchase and the actual build costs. Lenders will usually lend up to 70% of the cost of the land plus up to 100% of the cost of the actual build providing that the combined loans do not exceed 70% of the gross development value.

On completion of the project, the borrower would normally re-mortgage the property through a competitively priced normal mortgage lender and use the funds to pay back the original development loan.

Where the project is for renovation purposes the loans will follow similar LTV criteria.

• Completion is often within 14 days (Standard high street bank lending can take up to 3 months or longer).
• Less underwriting than with standard mortgage lending.
• Much better chance of being accepted than would be the case with a mortgage.
• Less paperwork involved than with standard mortgages.
• Only pay interest over the time you hold the loan (If the loan term was 18 months but you pay back in say 6 months, you only pay interest on those 6 months).