Obtaining finance for a building project or property development can be complex; even for the most experienced property developer, investor, or landlord. Why? Well, the lending marketing is vast, intricate, and ever changing.
If you have experience then you’ll know that oftentimes when it comes to finance, the solution for your last build might not be available or even suitable this time; based on your up to date circumstances, or the nature of the project.
Likewise, if this is your first project then it might feel like you are standing at the entrance to a maze, at the center of which is the cash you need.
Fear not! When it comes to construction finance, we happen to be subject matter experts.
Let us help you understand how to get the finance you need for a new building project or property development, or, get the cash to see you through to the end of your current works.
Get it right first time
Your aim should be to get this right first time as turndowns will negatively impact your credit file and affect your chances with other lenders if you’ve started in the wrong place, or at the right place with the wrong application. Take time to consider all steps we’re going to cover and create a roadmap before you start applying…
Which finance options are available for building or property development projects?
Let’s start here, as to get accepted for finance first you must identify the type of loan you need (and will most likely be accepted for – but more on that later).
Most property developers will be looking at two options:
- Secured Loans
- Secured Loans are great when it comes to getting the funds you need to kick-start a project
- Bridging Loans
- Commercial Bridging Loans can help you if cash flow stalls in the middle of a project
It doesn’t end there but this is where we would start.
Who will lend to builders or property developers?
The next thing you will want to do is identify a lender for your sector, the loan you want and your circumstances.
You must remember that each finance house has its own sweet spot for lending. They will have an ideal profile for who they want to lend to which is comprised of loan amount, loan purpose, loan term, business profile, credit history.
The lender you’re looking for is the one which profiles you!
While you might get a loan from a lender which doesn’t profile you, you will probably pay more. It pays to do your research here.
Which documents will I need for building or property development related finance?
As well as identification documents, you will also need a well packaged application. That is one which details you and your development accurately, and pre-empts underwriter requests before they’re made.
Doing this means that you are more likely to be approved, and it’ll happen more quickly too.
For more information read: How to get accepted for a business loan and find out how getting support can seriously increase your chances of acceptance
Property Development Finance Success Checklist
Let’s recap…
- Step 1: Decide which finance you need
- Step 2: Identify the right lender for you
- Step 3: Submit a great application
- Aim: Get it right first time
By following these steps, you will avoid:
- Lengthy processes – as you go through a variety of lenders and have to answer questions back and forward throughout the application
- Last minute turn downs – even after you’ve provided everything, then you have to start again
- Huge rates – because you are so exhausted and just need the finance, you’ll often settle for a bad rate just to get the money you need now
Good luck!
Psst…
Did you know that someone can do all of this for you?
Secret Step 4: CLICK HERE to watch this video and find out more about getting support from someone who does this every day