Development Finance For Inexperienced Developers

Development Finance For Inexperienced Developers

Clifton private finance

We specialise in arranging development finance on residential or commercial property transactions in the UK.

If you are looking to source finance on a residential or commercial property as a first time developer in the UK we can help.

We offer:

  • Development finance from £100,000 to £50m
  • Market leading rates
  • Finance options for England, Scotland, Wales and Northern Ireland (We can also source finance for projects in Ireland)
  • Loans up to 100% of development finance cost
  • Finance with no exit or early redemption fees
  • 2nd charge options
  • Terms up to 30 months
  • Complex cases always considered
  • Finance for a variety of ownership structures including multiple SPV's, Offshore SPV's, UK based trust structures, overseas trust structures
  • Finance for new build, conversion or refurbishment developments including mixed use and student accommodation
  • We can help source finance for land, commercial to residential conversions, unusual assets such as care homes, golf courses, places of worship, petrol stations, fisheries, air rights (with acceptable security) and charities

Flipping Property?

Buying, Renovating & Selling (or Letting)

Finance Rates from

0.44% pm

1 - 18 months

Rates up to 80% LTV

As at 21st June 2019

Ground Up Development

New Builds

Finance Rates from

0.335% pm

Up to 30 months

Rates up to 70% of GDV

As at 21st June 2019

Existing Development?

Refinance & Exit Finance

Finance Rates from

0.335% pm

1 to 18 months

Rates up to 75% LTV

As at 21st June 2019

Contact Us

Thank You for your interest - please complete the form below and a member of our team will be in contact.

We are independent and work with a range of UK lenders many of whom are specialist lenders that are not available on the high street. We pride ourselves on providing excellent service responsive to your needs.

Call us on 0203 900 4322 to discuss your requirements.

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Development Finance For Inexperienced Developers

What is Development Finance

Development finance is the money that funds property development. Typically, this will cover new building projects, including new homes, conversions of offices into flats, renovations of existing property on a residential, commercial or mixed basis.

One of the biggest issues for new property developers is accessing money to start their project. This is mainly because the majority of lenders are reluctant to lend to developers without a portfolio or a history of successful developments.

The lenders’ requirement for proven experience in property development may frustrate new developers, fortunately securing property development finance may not be an issue depending on the project.  Through a specialist property finance broker new developers may be able to access funding for their project.

When is Short Term Finance Appropriate

Short term finance provides a fast, alternative route to funding for new developers.

Property developers use short term finance for a variety of projects including:

If you are a new developer and you require short term finance to assist with your project, it is advisable to contact a specialist property finance broker.

What Short Term Finance Is Available

Bridging Finance

Bridging finance is a type of short term loan that provides additional finance to ‘bridge’ the gap in funding. Unlike traditional lenders, bridging finance providers do not necessarily need evidence of previous property development experience.  There are a number of lenders that will consider providing bridging finance for inexperienced developers on a case by case basis.

Bridging loans can assist new property developers because they:

It is important to note that bridging loans generally have higher interest rates than loans from traditional lenders. However, the majority of lenders help borrowers avoid monthly interest payments by ‘rolling up’ the interest on the loan to pay at the end of the term.

Example: A developer wanted to purchase a £200k property, spend 25k on the development and sell it on for 300k. They had some of their own capital but not enough to cover the purchase and development costs. Unfortunately, as they did not have any property development experience, they could not secure the £225k that they needed from their bank. So they approached a lender and secured 130k and 25K, which equated to 65% of the property’s purchase price and 100% of the building costs. They used the rest of their capital to purchase the property. On completion of the development, the developer sold the property and repaid the loan with the proceeds of the sale.

See latest development finance case studies »

How Can An Inexperienced Developer Get Property Development Finance

Working with a specialist broker to secure development finance if you are a first time developer can save you time and money.

Arranging development without professional assistance can be a long and drawn out process, with no guarantee of success. This is because almost all lenders are reluctant to lend to inexperienced developers due to the amount of risk involved. When developing a property, organising adequate finance can be lengthy and complex. In the event that development finance is required, it is advisable to contact a specialist property finance broker to ensure that the loan is appropriate, with fair terms and at the best available rates.

Call us on 0203 900 4322 to discuss your requirements.
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