Development finance for a new build
If you are looking for finance for a new build development there a range of lenders that you could consider.
Getting the right lender in place can be critical to the project’s success.
Ideally you want a lender that can provide flexibility, speed and a personal service.
What New Build Lenders Will Look at
Lenders will look at the GDV of the project.
This is the gross development value which in simple terms is the value of the project once all development works have been completed on the open market in the current economic climate.
The GDV will include the land cost, building and construction cost, development fees and the profit from the sale of the development.
At the time of writing lenders will lend up to 50% to 60% of the GDV. Some will consider going higher than this depending on the project.
For new build projects this might typically include the cost of the land purchase and up to 50% to 60% of the final purchase price. Many lenders will find 100% of the construction costs.
Typically a new build can be broken up into different stages once the land is purchased and planning permission is in place.
- Wall Plate
- First Fix
- Second Fix
Depending on requirements finance raised can be used to clear existing debt from the land purchase and fees incurred to date with the remaining development finance released in stages – this means that interest is only paid on finance that is used.
How Quickly Can I Get Development Finance?
How quickly you can get finance in place for your project will depend on a number of factors but all being well funds can be advanced quickly – taking into account solicitor documentation 10 to 14 days is a realistic average timescale.
To discuss your new build project and finance requirements call our team on 0117 959 5094 or request a callback.
We can normally provide a same day decision on your project and a formal offer can be provided within 24 to 48 hours.