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You are here: Home / Bridging Loans / Property Development Finance 100% of Build Costs

by Payam Azadi

Property Development Finance 100% of Build Costs

buy to let mortgage visa

100% of Build Costs On Day One

  • Free Quote
  • Auction, Bridging and Development Finance in one place.
  • Experienced Brokers watch our Youtube channel to learn more
  • A hand picked panel of reputable Development Finance lenders
  • Loans from £50,000 to £20,000,000
  • Residential, Buy to Let and Commercial Finance Exit routes
  • First Time Buyers Auction Finance
  • First Time Landlords Auction Finance
  • Light Refurbishment products offered for “flipping”
  • Bridge to Let Product to give landlords certainly and comfort
  • Complex Income structure
  • Lending on the end value
GET A FREE BRIDGING LOAN QUOTE

Property Development Finance is not always stright forward, If you have had experience in obtaining development business you will have encountered phrases such as ‘lend against open market value’ and ‘based on a 90 day valuation’. This is jargon associated with the maximum a suitor is prepared to lend against.

It is not uncommon for the lender to restrict the borrowing to sixty five to seventy five percent. This may be enough? However this short sightedness often means that sometimes even the best strategies of developing plots struggle to get off the ground.

How Can I Borrow More To Develop?

Well we can help educate you to think laterally rather than look at developments in isolation, for instance it could be the case of securing finance temporally across multiple assets.

Where Traditional Finance Sources Fail

Well, in short, as they simply do not advance enough.

For example, it could be that you have bought a plot for £100,000 (A) and plan to build five residential bungalows on it. The expected value at the end of the project is £850,000 (B) and the cost to build the properties is £400,000. In simple terms the project appears to stack up with a straight £350,000 profit. But how do you get from A to B unless you have £400,000 readily available?

At best traditional mortgages and bridging finance would typically lend a fraction of the value in arrears after the first stage has been built and then only on the value as it currently stands not taking into account the end game.

To return to the example, this might mean after the first stage the development is worth £150,000 (to include the £100,000 plot and £50,000 for the foundations). The lenders would advance say 65% of this i.e. £97,500 towards your outlay to date. It can get very messy and hard on cash-flow and often unworkable.

Our Solution Advances Development Costs Upfront:

At Niche Advice we have access to a range of lenders working in the Property Development Finance arena, with funding that provides 100% of the build cost on day one! That’s right, no: ifs, buts maybes, interim valuations etc. Such a powerful tool is however, restricted to developers with a provable track record and well conceived business plan for the new project.

Product Detail:

Development funding available for up to 6 houses or 4 flats per project.

Typically restricted to London, South East, West Midlands and South Wales.

How much does it cost:

Each case is underwritten on its own merits but rates are around 1.5% a month and the Lender charges are typically 2% of the Loan advance. Legal and Valuation fees also apply. Full infomration can be provided once we have more detail on the project.

GET A FREE BRIDGING LOAN QUOTE
Payam Azadi

Author: Payam Azadi

Payam Azadi is a partner at Niche Advice who are whole of the market Independent Mortgage Brokers. His role is very much focused on Property financing both on residential and commercial lines. To get in contact with him please click here.
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Filed Under: Bridging Loans Tagged With: 100% Development Finance, 100% of new Build Costs On Day One, builder finance solutions, development finance, Development funding available for up to 6 houses, finance for Professional Developers, finance for property builders, Finance options for building a property, funding for new property development, low deposit Development Finance, new build finance options, obtaining development mortgage, property development finance, Property Development Finance london, Property Development Finance South East, self build finance, short term finance for new build property, short term loan for builders

Bridging Finance Dangers in 2020

https://youtu.be/okMrRFZdnhM

Contact Us

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AS A MORTGAGE IS SECURED AGAINST YOUR HOME OR PROPERTY, IT COULD BE REPOSSESSED IF YOU DO NOT KEEP UP THE MORTGAGE REPAYMENTS.

If you are thinking of consolidating existing borrowing you should be aware that you may be extending the terms of the debt and increasing the total amount you repay.

Niche Advice Limited is a Credit Broker and does not lend money directly to clients. Niche Advice Limited is authorised and regulated by the Financial Conduct Authority. FCA Number: 750263.

Commercial Buy-to-Let and commercial mortgages are not regulated by the Financial Conduct Authority.

Our Fees

Click here for our fees structure. A full detailed fee plan will accompany all our quotes.

Niche Advice Limited has a commercial arrangement under an affiliate programme with Check My File and is remunerated for referrals.

Terms and Conditions

If you wish to register a complaint, please write to us on the details below or call us on: 020 7993 2044.

Correspondence Address: Niche, Unit F6, The Addington Business Centre, Vulcan Way, New Addington, Surrey CR0 9UG.

A summary of our internal complaints handling procedures for the reasonable and prompt handling of complaints is available on request and if you cannot settle your complaint with us, you may be entitled to refer it to the Financial Ombudsman Service at www.financial-ombudsman.org.uk or by contacting them on 0800 0234567.

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Tel: 020 7993 2044

Registered Office: Niche, Unit F3, The Addington Business Centre, Vulcan Way, New Addington, Surrey CR0 9UG. Registered in England & Wales. Company registration number: 06599033.

Members of The Financial Intermediary & Broker Association - Number SBS36389

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