Development Finance 2017-06-06T19:22:42+00:00

Development Finance

  • 100% finance available
  • Property development loans
  • Residential & commercial
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Access The Markets Best Development Finance Rates Through One Enquiry

Get in touch today for unbiased development finance advice and find out about our market leading rates. We can provide you with a fast, free and no obligation agreement in principle.

Funding your next development needn’t be a headache. By choosing to work with ABC Finance Ltd you will have access to simple and unbiased advice to make sure your finance costs remain as low as possible as you build out. As one of the top development finance brokers in the UK we are best placed to offer the right solution to you, whether you are an experienced builder or just starting out in property refurbishment.

Our property development loans are available for residential, commercial and mixed-use schemes and our close links with many lenders mean we always offer market leading rates to our clients. We are able to support schemes all throughout England, Wales and Scotland. By using our specialist lender contacts, we won’t restrict borrowing to London or the other major cities as many lenders and brokers do.

As a well-established Development Finance broker, we are proud of our strong relationships with top lenders and use them to help secure you the best possible terms for your new project. For experienced developers we can even help you secure rolling funding for your business, allowing you to look at potential builds, knowing the borrowing parameters for a suitable project before you start.

Property Development Loans can be a complex subject for even the experienced investor. As such we try to take the strain out of choosing the best lender for you and can provide you with more than one option as needed. If you are torn between achieving the highest loan amount, securing the best interest rate or even a compromise somewhere in the middle, we will help you to understand the consequences on your build. Throughout the whole process we will make sure all correspondence is simple and easy to understand and guide you through the process from initial enquiry right through drawdown and eventual exit of your loan.

  • Joint Venture Schemes
  • Build to Let
  • Commercial Development
  • Residential/Mixed Use
  • 100% Equity Finance
  • Build Your Own Home
  • Permitted Development Rights
  • Part Finished Developments
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What Is Property Development Finance?

Property Development finance is used to fund the construction of new buildings or conversion/refurbishment of existing ones. It is usually only used during the period of planning and construction before sale or refinance takes place. Funds tend to be released in ‘tranches’ – stage payments, released upon reaching set benchmarks in the build.

How Much Can I Borrow?

Lots of factors are taken into account when pricing a development loan such as the location of the scheme, the likely demand once built, and the amount borrowed in relation to the value and your experience and financial situation.

Lenders tend to look through each application on its own merits using the factors above and many more; specialist knowledge of an area is often available through previous projects and all of this combined will help a lender come up with terms. Of course we can push for lower rates using our knowledge of their competitors to push for a competitive environment and therefore more competitive terms.

As a rough guide, we are able to offer rates from around 5.5% for strong schemes with far wider variance than many other types of borrowing, meaning the best way to get an understanding of the terms available to you is to run it through with one of our Development Finance Experts.

Do You Offer 100% Joint Venture (JV) Funding?

Yes, we are able to offer joint venture funding from both property development finance lenders and wealthy individuals. Each case tends to vary when looking at this kind of funding with equity splits and interest calculations both coming in to play.

As a rough guide you will normally end up with around 50%-60% of the profit at the end of a joint venture scheme.

Due to the case by case nature of this kind of funding, we recommend talking through your individual needs with one our expert advisors who would be able to provide you with a full breakdown of costs based on both your circumstances and the scheme you are looking at.

What Products Are ABC Finance Able To Offer?

We have a Development Loan for almost any circumstances including:-

  • Stretch Senior Development Financing
  • Mezzanine Funding
  • Commercial Development
  • Joint Venture Funding
  • Build to Let
  • Sales Period Funding
  • Planning Gain
  • Conversions and Refurbishments
  • Mixed Use Development
  • Pre-Development Bridging

How Is The Interest Rate On A Property Development Loan Calculated?

Lots of factors are taken into account when pricing a development loan such as the location of the scheme, the likely demand once built, the amount borrowed in relation to the value and your experience and financial situation.

Lenders tend to look through each application on its own merits using the factors above and many more, specialist knowledge of an area is often available through previous projects and all of this combined will help a lender come up with terms. Of course we can push for lower rates using our knowledge of their competitors to push for a competitive environment and therefore more competitive terms.

As a rough guide, we are able to offer rates from around 5.5% for strong schemes with far wider variance than many other types of borrowing, meaning the best way to get an understanding of the terms available to you is to run it through with one of our Development Financing Experts.

How Much Are You Able To Lend?

The maximum loan for each application is worked out based on a percentage of the value of the scheme once finished, this is known as loan to gross development value (LTGDV). We are able to offer up to 80% of the Gross Development Value currently. In addition to this calculation, lenders then work against a maximum of the cost of buying and building the site out. This is known and loan to cost (LTC) and currently we are able to offer 90% of the build costs, subject to meeting the LTGDV calculation for the product chosen.

We can offer development finance from £26,000 up to £80,000,000 – and even beyond that for the right project.

Below is an example of these calculations in practice:
A client owns a site, currently valued at £3,800,000 with planning permission for 38 apartments and an anticipated gross development value of £10,250,000. The build is expected to cost in total £7,800,000 (including acquiring the site). In this case the client requires as much borrowing as possible. If we allow for 75% loan to gross development value and 90% loan to cost the maximum LTGDV is £7,650,000 and the maximum LTC is £7,020,000. The lender would then allow a maximum loan of the lower of these two figures.

If you’re looking to borrow beyond this amount, we can arrange terms for Joint Venture Development Finance lenders. This allows you to borrow all of the costs of purchasing the site and building it out, with a pre-agreed profit share on completion. This form of finance is generally more openly available to experienced developers only.

How Long Can I Borrow The Money For?

Our lenders operate up to a maximum of 48 months, however there would normally be some element of sale or let already taking place within a 48 month period of a project commencing.

Development Finance Complete Guide

Click here to read The Complete Guide to Development Finance. For no obligation advice or a fast agreement in principle, enquire now or call 0800 088 6008 to speak to one of our finance experts.

All types of development
including barn conversions

Finance for land only
with or without planning

All enquiries considered
from £25,000 to £100 million

Large developments accepted
also single properties

property development finance

Case Study: Development Finance

An experienced developer expected their usual bank to be prepared to finance their latest project for five barn conversions in an idyllic countryside location. However, the fact that the newly developed properties would be live / work units proved difficult to property development loans until ABC Finance arranged for one of their property development lenders to fund the project. The style and quality of the completed properties soon found buyers.

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