Each development finance product is unique. A bespoke agreement was reached between the issuer and the borrower. There are various different types of development finance that can be issued, each targeting different kinds of developments and fulfilling developers’ individual requirements.
But what remains consistent with all types of development finance is the importance of submitting the appropriate paperwork. The documentation you provide to support your application will play a major role in determining your eligibility for funding.
It is therefore essential to ensure you have the right documentation in place ahead of time, reducing the risk of delays and disruptions.
What paperwork do I need?
The extent of the paperwork required as part of your application for funding will be determined by the nature and extent of your requirements.
However, the overwhelming majority of lenders will expect to be presented with formal evidence of the following as standard:
- The value of the property at the time of your application
- The estimated final value of the completed development
- An overview of all construction and renovation costs
- A complete dissection of the project’s schedule and deadlines
- Extensive evidence of your experience and track record
- Examples of successfully completed similar projects
- Full disclosure of all providers involved in this project
- Confirmation of receipt of planning permission and permits
- Acknowledgement of any restrictions that may apply
In addition to the above, you will also need to provide your lender with evidence of a workable exit strategy. Your job is essentially to convince your lender that you are a safe candidate for development finance by showing them exactly when and how you will repay the facility.
This could be in the form of a lump-sum payment following the sale of the completed development or by transitioning your development finance loan onto a longer-term repayment product.
Do I need a broker?
While broker support is not mandatory when applying for development finance products, it can be beneficial in a variety of ways.
A few of the many advantages of enlisting independent broker support:
- Access to the broadest possible market of lenders and development finance products, as many specialist service providers offer their services exclusively via introductions.
- Independent expert advice on the various types of development finance products available will help you make the right choice for your project.
- A knowledgeable and experienced professional to negotiate on your behalf, ensuring you get the best possible deal from a top-rated lender.
- The advice and support you need to present a convincing application, complete with all necessary documentation and supporting evidence,
- A faster and simpler application process is essential when looking to secure funding in a time-critical scenario.
As broker support is offered 100% free of charge to the client, it simply makes sense to take advantage of their knowledge and expertise.
For more information on the logistics of development finance or to get your application underway, contact a member of the team at UK Property Finance today.