How Much Can I Borrow?
We can fund up to 85% of the current market value of the security property, if that’s less than 65% of the hope value. We can offer facilities such as the above for loans between £100,000 and £1,000,000.
If you’re looking for more, we can lend up to 80% of the current open market value with no maximum loan size.
How Much Will It Cost?
The interest rate charged will depend on what is currently on the site and the loan to value requested. We offer bridging loans on the following terms:
|Security||Max LTV||Rates From|
|Land With Planning||65%||0.75%|
|Land Without Planning||50%||1.00%|
Applications are also subject to a lender arrangement fee, usually 2% of the loan amount. This is sometimes reduced where the requested loan amount is large and can be as low as 1% in some cases.
How Long Does Planning Gain Finance Take to Complete?
We can fund your bridging loan the same day, where the valuation and legal pack are already fully completed, although this is very rare.
In general, you can expect your planning gain bridging loan to take between 5 days – 2 weeks to complete.
How Does It Work?
This type of borrowing is designed to allow investors to purchase sites, either land or property, that has potential for planning permission.
Once the site is purchased, a planning application is then submitted. Once this is approved, the site will generally have increased in value and can be sold for a profit or developed by the borrower.
Finance is only generally used to fund the planning process. Once permission has been granted, development finance is generally used to fund the development project.
How Will My Application Be Assessed?
The lender will need to be comfortable with the security offered in its current form. This will protect them in the event of planning permission being declined.
In most cases, the lender will want to know what your backup plan is should your planning application be refused.
Some lenders may have experience in planning gain and will look at the viability of your proposed application. To give them a picture of this, they will tend to look at the following:
- The planning history of the site/land. Previously declined applications may indicate that the planning is difficult to achieve on the site.
- Is the site in the local plan?
- Is there precedent locally which would suggest that your application is likely to be successful?
- Is the proposed application in keeping with the area?
- Do you or your architect have experience of these types of applications in your area?
Of course, this list is not exhaustive, but will give you some idea of the checks undertaken.