Property & Development Finance
Property Development Finance
Brief details:
- Non high street lenders used.
- Provable track record required.
- No new developers unless part of JV with experienced.
- Minimum loan values £150k.
- New builds preferred or residential conversions considered.
- Developer must put in up to 50% of plot price as minimum
- Loan To value 50-60% of gross development value.
- Project must be ready to start.
- Funds released in 4-5 stage payments after inspection.
- Detailed project analysis & costs required.
- Each development judged on it’s own merit.
- Interest can be rolled up till end with some lenders.
Self Build Project Finance
Lending Criteria:
- Can only be used for a main residence build only.
- Half a dozen lenders will do this finance.
- Up to 75% Loan To Value loan given.
- Stage payments of fund paid in arrears.
- Affordability linked
- Self employed allowed calculated at 4 x your net profits.
- Employed- 3 to 4 times salary given as multiple.
- Simple loan- one interest rate throughout loan term.
- Will lend up to 75% of land cost + 75% build costs.
- Loan will be pulled if attempt to use for property development.
ECO Property Developments
- Up o 75% of land value and 75% of project costs.
- Each ECO addition reduces interest rate by 0.25% up to 1.5% max
Delayed Completion Bridging
- Bridging company agrees terms with you ( Like a bank “agreement in principle.”)
- You find and negotiate a discounted direct from vendor deal.
- Agree a quick exchange and a 5% deposit for the vendor should you not complete.
- Agree access to the property and a delayed completion of around 8 weeks.
- Agreements are signed at solicitors by all parties and date to complete.
- Refurbish the property to add value, at same time bridging remainder details are arranged.
- Property is surveyed at refurbishment completion and bridge is arranged on post refurb value.
- At completion a remortgage with new lender who allows a 3 month rule is used to pay off the bridging.
This method allows all of your cash back at completion and is a fully legal tried and tested method. If you manage to finish the project early you can settle the bridging quickly, allowing a refund of some of the bridging cost back to you.
Experience on how to uplift the value of a property to enable the method to work for you in a timely manner is essential. Otherwise extra costs would be incurred during the process.
Asset Based Lending
- Short term loans higher than bridging rates.
- Fast finance from private lending sources.
- Lending based on your luxury tangible assets such as;
- Art, cars, jewelry,personal number plates etc.
- Quick turnaround on loan deposit-usually 48hours..
- Raise finance from you existing non property assets.
- Can get you out of trouble very quickly.
- Your mortgage free property is valued.
- A loan is underwritten for up to 60% of the value.
- You can draw down on the loan as you wish.
- Loans from 1-2% per month for short term finance use.
Bridging & Unencumbered Property Finance
- Your mortgage free property is valued.
- A loan is underwritten for up to 60% of the value.
- You can draw down on the loan as you wish.
- Loans from 1-2% per month for short term finance use.
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