Property Development Finance
The property development sector is undergoing a significant period of change dealing with the fall-out from the pandemic, Brexit and new legislations that have created a more unpredictable marketplace than we have been used to.
However, when it comes to property development finance, our experienced team at Vincent Burch Mortgage Services can ease any uncertainty. We’re a reliable, trustworthy partner for thousands of independent developers and can help secure you the right finance deal for your business.
Search development finance from 100s of products
Whether you’re looking for finance for land or a building purchase, property conversion or refurbishment, our advisers will work closely with you to understand your specific needs. Together we’ll develop a robust, tailored application that will include all the information that development finance lenders require, for example:
- Location of development
- Assets offered as security
- Project Feasibility
- Expected timescale
- Breakdown of costs
- End value of the project
- Planning permission and experience
The interest rates offered for property developer finance are specific to each application so getting it right the first time is key to securing the most favourable deal.
Developing our Relationship
As property development finance brokers, we know that getting the right finance in place is crucial to the success of your business. We’ve been helping to grow portfolios for over 20 years and can access a wide choice of lenders and competitive rates from across the whole market with a personal service, at no extra cost.
How do you finance a property development?
Much like other secured loans, you need collateral. In this case, the collateral is the real estate project. The loan itself is tailored to the cost and time of residential property construction and sale processes.
Development finance can be obtained from a range of lenders, such as major banks, investment companies, independent financiers and specialist property lenders.
How much deposit do you need for property development?
If you require funding to buy land with the development costs dependent on the project, lenders will want to see 30% of the acquisition cost.
Who is eligible for development finance?
You are eligible for development finance if you can present a concrete project with a Gross Development Value (GDV) that aligns with market research, and development experience (or if you are able to surround yourself with an experienced team).
Another important aspect is having a good track record in repaying borrowed funds, or prior experience in completing development projects – however some lenders may lend to less experienced clients at higher interest rates.
How much can you borrow with development finance?
Unlike regular home or business mortgages, development loans are paid out in stages from an agreed loan pool. Lenders will typically limit the amount they are willing to loan to no more than 65% of land purchase costs, and up to 100% of construction costs.
What are the benefits of development finance?
Development finance has many benefits, including:
- Quick access to funding
- Bridging loans for project gaps
- Heavy refurbishment projects
- Extended loan terms
- Flexible repayment options
- And more.
For more information on development financing, get in touch with us at Vincent Burch.
Can you get a mortgage for development land?
Yes, there is the option to get a mortgage to buy land, however there are fewer specialist lenders available for this than those offering mortgages to buy property. Mainstream lenders tend to avoid this type of financing, as it is considered higher risk, so you may find more success with a specialist lender.
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