Struggling To Raise Development Finance?
Check out the benefits of Collective Investment Schemes, a viable alternative source of much needed capital.
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Development Finance
100% of refurb costs
Projects all over England, Scotland, Wales
GDV £100k - £3m
Interest Rate from 1.25% per month
Arrangement Fee 2%
Exit Fee 1 month interest
24hr Decision
Family housing
Apartments (high demand areas)
Gross Profit Margin must show – 15% on total cost (after bank interest)
Developer to provide 30% of purchase price
Ideal for properties requiring full internal refurbishment
If your speciality is fast refurb of housing anywhere in the UK, this lending product could be just what you are looking for.
This lending product is aimed at small developers or contractors who have an eye for a deal. Next time you find an opportunity talk to us for a fast decision on funding. All types of property condition are acceptable, right through to full strip-out and refit.
The lending decision is based on the lower of purchase price or Open Market Value and level of profit margin once completed. You will need your own cash to put into each project; 30% of the purchase price /OMV.
Given the relatively high cost of this lending, it works best where you can get in and out of the deal quickly. Although the loan can be geared to last up to 12 months, we recommend you focus on deals where the sales market for the completed project gets you in and out in 6 months or less.
Here’s an example:
| Valuation on Purchase | £275,000 | |
| Refurb Costs | £50,000 | |
| Total Costs | £340,000 | |
| Valuation on Completion | £415,000 | |
| Gross Profit Margin | £75,000 | |
| GPM % on Cost | 22.06% | |
| GPM % on Valuation | 18.07% | |
| Finance: | ||
| Lender 70% Valuation | £192,500 | |
| Developer 30% Valuation | £82,500 | |
| Lender 100% Refurb Costs | £50,000 | |
| Arrangement Fee (2%) | £4,850 | |
| Interest (1.25% per month) | £18,188 | |
| (assume 6 months) | ||
| Exit Fee (1 month interest) | £3,031 | |
| Total Finance Costs | £26,069 | |
| Developer's Net Profit | £48,931 | |
| Return on Capital (Developer) | 59.31% | in 6 months |
| Return on Capital (Lender) | 10.75% | in 6 months |