How to Get Development Finance for a New Build
Property development is a booming area of the UK, and developers in the UK are working within one of the most competitive markets in the world. Thanks to the mounting demand for modern-style homes, developers are always searching for new opportunities. –The one key aspect for a successful project is the right financial stack, or, in layman’s language, new build development finance.
Are you planning to build or invest in a new build? Then it is a no-brainer that you are thinking of an adequate funding plan to get the project started. We know your mind is filled with how, why, if, and buts. To clear the smoke, we will share ways to get development finance for ‘your’ new build. Before we get into the details, it will be best to understand the importance of financing a new build through a development loan.
Starting From Ground Zero
Development finance is an integral part of any new build, conversion or heavy refurbishment project. While homeowners can be ready to put down larger deposits into their house purchases to get a competitive mortgage, the reverse method is often true for commercial projects – the more equity they put in, the less available amount they have for their upcoming projects. Development finance is considered a foundation for any new build, conversion or heavy refurb project. An experienced broker can understand how to fulfil its part to get the most favourable terms from the lenders.
Most of the time, developers think approaching high street banks for development finance is the quickest option but this may not be the case. High street banks are slow and will not have the best deals available to minimise equity contributions. In a nutshell, getting a new build development loan from a traditional lender is a daunting process. In such a case, a specialist finance broker is the best option.
Levelling Up – Getting Into Details
Often, traditional lenders struggle to meet the requirements of new build projects; developers need lenders who can evaluate projects commercially and take an innovative approach to finance projects.
It is also known as a short term loan that can offer a hefty amount in a short time.
Following are the benefits that make it the developer’s number one choice:
- Fast approach
- Terms of finance are between one to thirty-six months depending on LTVs and exits
- Big range of finance
- Flexible and personalised terms
If you are looking for a short-term loan, bridging finance is the ideal option.
100% Development Finance
If you are an experienced developer, go for a 100% new build development finance. It can provide:
- Upto 90% LTC (loan to cost)
- Terms of finance between three to twenty-four months
- A loan from £ 100,000
Besides bridging and development finance, other new build development loans are available, but they are only for experienced developers. Still, if you require a new build development finance and are a bit confused between available options, then contacting a professional broker can benefit you.
Explore opportunities by contacting finspace, a trusted property finance broker in the UK and get the best advice for your new residential, commercial and development ventures!