Development finance and how it is used.
Development finance is simply borrowing whereby funds are required to undertake a development or refurbishment. It can be used for residential or commercial properties of any scale.
This type of finance is unique with the lender considering the value of the project and not just the property or land. The terms often reflect the short term nature of the repayment, normally no more than one or two years. Different lenders will have a preferred investment level or type of project, so speaking to a broker is often very useful.
The type and size of the project will be instrumental in the lenders decision, as will the experience and track record of those involved and the chances if success. Traditional mortgage lenders are only interested in the value of the property, but development financers are much more flexible in their approach and will lend on the merits of the project itself. Funds can also be released very quickly meaning there is no delay in the development or refurbishment.