Property development finance brokers

Development finance caters to the unique requirements and complexities of property development projects. There is a variety of options available from lenders and the right solution for you will depend upon your objectives.

After getting to understand the project you are undertaking, our expert brokers can help you understand your options and navigate the process of applying to lenders, helping you secure the most appropriate development finance to support your project.

• Huge network of lenders
• Award-winning development finance brokers
• Rated 'Excellent' by clients

08000 38 37 36
Arrange a free appointment

What is development finance?

Development finance is a type of financing used to fund property development projects, including residential housing and commercial buildings. It's sometimes also referred to as property development mortgages or developer loans. It typically consists of short-to-medium-term secured loans with high interest rates and a drawdown facility.

What can property development finance be used for?

Development finance is a bespoke solution, so how you use the funds will depend entirely on the nature of your project. Common uses include:

• Land acquisition
• Construction costs
• Conversion of existing buildings
• Renovation or refurbishment of existing properties
• Infrastructure costs
• Marketing and selling costs
• Professional fees
• Working capital to cover costs during development

How does property development finance work?

The way development finance works is different from other types of loans in a few key ways.

Approaching lenders

Traditional banks typically view development finance as a high-risk, specialised form of finance, so it's better sourced from a specialist provider.

It's best to enlist the help of experienced brokers when approaching specialist lenders. They will usually only initially speak with brokers as intermediaries. Brokers can also help you put your best foot forward, streamline the application process and secure more favourable terms.

Receiving funding

After the initial release, the lender releases the funds in phases, typically corresponding to key stages of the development process. This prevents you from paying interest on funds you can't spend yet and gives you the flexibility to keep your costs down as your project unfolds, while also allowing the lender to monitor the progress of your project.

Repaying your loan

Your repayment strategy will be agreed with the lender from the outset. Most people typically fund the repayment through selling the developed properties or refinancing.

How our property development finance brokers can help

Our specialist brokers can streamline the process of securing development financing for your project, ensuring an efficient application and maximising your chances of gaining approval for the terms most favourable to you.

1. Understanding your needs

After discussing your goals and the details of your project, we can evaluate your eligibility for development finance and identify the most suitable options.

2. Selecting lenders

We'll use our vast network to find a range of lenders that align with your project requirements and offer competitive rates and terms.

3. Preparing your application

We can help you gather the necessary documentation to support your development finance application, which can require much more than a traditional loan or mortgage application.

4. Negotiating with lenders

Our highly experienced brokers know how to highlight the strengths of your project to maximise your chances of approval. They will also skilfully advocate on your behalf when negotiating terms like interest rates and repayment options.

5. Securing funding

We can help facilitate the approval process by addressing any additional lender conditions so you can receive your funds.

6. Providing ongoing support

We'll continue to provide guidance throughout the development process, including repaying your loan and exploring options for refinancing should you need it.

Why choose Alexander Hall's development finance brokers?

After more than 30 years, we know the specialist finance industry inside and out, and have the experience to help you find the right development loan for your needs. Here are some of the reasons you can rely on us:

• Trustworthy brokers: Our development finance experts are completely impartial and only interested in helping you obtain the right funding to support your project.
• Extensive network: We can give you access to a wide range of options, with 100+ lenders in our network, including those that specialise in property development loans.
• Stress-free process: Our brokers will handle all the most difficult aspects of your application, freeing up your time and energy to focus on the intricacies of your development project.
• Outstanding service: We're committed to providing the highest levels of service, a promise that's reflected in thousands of 'Excellent' reviews on Trustpilot.
• Award-winning brokers: We've won many awards and accolades over the years, including Best Broker for Customer Service in the Legal & General 2024 Mortgage Club Awards.

Can I get a loan for property development?

Criteria can vary between lenders, but some key factors will improve your eligibility for development finance:

• Your experience, trading history and portfolio as a developer
• Your credit history
• The security you can put up against the lender's money
• The equity you can contribute to the project costs
• Having the necessary planning permission in place

Our experienced brokers can tell you whether you are eligible for development finance, so feel free to get in touch and arrange a free appointment.

How much can I borrow through development finance?

The amount of development finance you can secure will depend on the provider's lending parameters and valuation report.

Each lender has its own parameters determining the maximum amount they're willing to lend. Few are willing to lend more than 70% loan-to-value on property development projects.

The lender's valuation report establishes:

• The current value of the site you plan to build on or the property you plan to refurbish
• The projected total costs of your project
• The gross development value (GDV) or estimated market value of the property when the project is complete

What are the risks associated with development finance?

As with any type of loan, there are certain risks associated with property development finance that you'll need to account for when considering whether it's the right option for you. Various issues can occur that could extend the project's budget and timeline. Moreover, you might have difficulty selling or refinancing the completed project.

The short repayment periods and high interest rates of development finance can add pressure to the considerable stresses and complexities of managing a project, so it's crucial to consider all your options and prepare properly to avoid unnecessary difficulties.

How long does it take to get approved for development finance?

Applications for property development finance can take several weeks to be approved. It depends on various factors, such as the scale of the project and how long it takes for the lender to assess your ability to repay the loan. Our experts can accelerate the process by ensuring you meet the lender's requirements and your proposal has all the necessary supporting documentation.

Can I apply for development finance with a bad credit history?

Lenders have rigorous requirements and typically assess your credit history to gauge the risk of lending. It is possible to apply for development finance, but it will be difficult to secure the funding. It's advisable that you seek the assistance of expert brokers who can help you give your application the best chance of success.

Get in touch with our expert development finance brokers

After understanding your project and unique circumstances, we'll take the hassle out of acquiring development finance that works for you. Whatever your situation, our specialist brokers are ready and waiting to help. Feel free to get in touch with our experts and arrange a time to discuss your needs.

08000 38 37 36
Arrange a free appointment