Finish and Exit Development Finance
Get the best development finance deal from award winning brokers ABC Finance.
Rated Excellent on Reviews.co.uk
Finish and exit development finance allows you to raise finance against a part complete property development project in order to complete the build.
It’s designed for stalled developments, or those that would otherwise stall without additional funding.
At ABC Finance, we are market leaders in the funding of part complete builds, so get in touch now and we’ll get you the finance you need, quickly.
Finish and exit explained
What is finish and exit finance?
Finish and exit finance is a form of property finance that acts as a hybrid between a bridging loan and development finance.
It is used to fund part built property development schemes that require further funding to take the project to practical completion status.
How does it work?
It works by releasing funds, usually in two stages. The first stage is an initial advance, which is released as the loan completes, and is often used to repay an existing finance facility.
The second stage, which can be broken down into further stages, is released to fund the development of the units.
Maximum borrowing
How much can I borrow?
We can arrange finance and exit development finance from £50,000 with no maximum loan size.
Most projects are £500,000 plus, with multi million pound borrowing facilities being commonplace for this type of funding.
How is the maximum loan calculated?
The maximum borrowing figure is calculated through the loan to gross development value calculation.
We can arrange a maximum of 75% loan to GDV, and up to 70% of the current value (with stage payments taking the total facility size beyond this level.
Maximum borrowing calculations take into account your chosen exit strategy, which is usually either sale of the completed units, refinance to long term borrowing or refinance to a development exit finance facility.
Finish and exit finance costs
What rates will I pay?
Interest rates can vary depending on how advanced the build programme is, your experience and the location of the scheme.
We can offer rates from 0.39% per month for part complete development projects that require a light touch finish. For projects with heavier works required to complete, rates are available from 0.56% per month.
Most loans cost between 0.75-0.9% per month, or 9% to 10.8% per year.
In almost all cases, the interest costs are added to the loan, leaving you with no monthly repayments to make.
Are there other costs?
Yes, the other costs to consider are:
- Lender arrangement fee – On completion of the loan, the lender will charge a fee to setup the loan. This fee is usually 1-2% of the facility size and can be added to the loan.
- Broker fee – When using a broker, they may charge a broker fee either upfront or on completion of the loan. This fee is usually 1-1.5% of the facility amount. At ABC Finance, we don’t charge broker fees on these loans.
- Valuation fee – Charged upon acceptance of the loan by the lender, this fee varies depending on your property location, current valuation and gross development value.
- QS or monitoring surveyor fees – Charged on an ongoing basis to track site progress as stage release payments are requested. These are quoted on an individual basis.
- Legal costs – Charged during the application process to facilitate the legal arrangement of the loan facility.
- Exit fees – Some, but not all facilities may come with an exit fee of anything from 1 months interest to 2%. Some facilities will not have an exit fee, which can save you a significant amount of money.
Keep reading – Ground up development finance or 70% GDV Development Finance.
Qualification criteria
Will I qualify?
If you’re part way through a project and have at least 30% equity, there is a good chance that you’ll qualify.
Which locations can you offer financing in?
We can consider loans throughout the UK, including:
- England
- Scotland
- Wales, and
- Northern Ireland
Some remote areas may be harder to fund, and demand for similar properties in the same location will be key to a successful application.
Do I need experience of property development?
No, we can fund part built projects for first-time developers, although the reason that the project has stalled and the experience of your main contractor is key in this situation.
Can I qualify if I have bad credit?
Yes, we can fund applications for borrowers with a poor credit history or low credit score.
Applying for finish and exit finance
What documents will I have to provide?
To apply, you must provide:
- Details of the scheme, including the address, units being built, current development progress.
- Details of the costs to date, the cost to complete the units and the gross development value (GDV).
- Details of any agreed sales
- Copies of planning permission (or a link to the planning documents on the planning portal).
How fast can I get the money?
We can get you a decision in principle in 1 hour, submit your application within 24 hours of your enquiry and get your application completed and the funds in your account in 2 weeks.
What happens when I enquire with ABC Finance?
Within minutes of your enquiry, we’ll get in touch to understand your requirements in full, to enable us to secure the best possible finance terms based your circumstances and needs.
In most cases, we can provide a written decision in principle within 1 hour. Should you choose to go ahead, we work with you to put together a strong application pack for you and manage the whole process through to completion.
