DEVELOPMENT FINANCE

A development loan is designed specifically to assist you with the purchase costs and building costs associated with a residential or commercial development projects. This can be a new build, conversion or refurbishment covering a single unit through to multiple units built across a number of phases. It’s usually set up as a short term loan, usually between 6-24 months to fund the project only during the build and once the project has been built out, the loan is usually repaid through the sale of the property (or) refinance to a residential mortgage(or) buy to let mortgage.

The maximum borrowing is usually based around three main points:

  1. Maximum advance pay out, which the lender is happy to advance at the start of the loan. This figure varies with each lender’s criteria but it’s typically limited to 65-70% of the property value but some lenders might lend you more.
  2. Maximum Loan to cost value which the lender is happy to advance as a percentage of the total project cost. This figure varies with each lender’s criteria but it’s typically limited between 80-90% of the total project cost.
  3. Maximum Loan to GDV which is the lender’s maximum loan as a percentage of the final project value. It’s usually offered between 60-70% of the gross development value (GDV).
It’s important to compare all the associated costs with the finance because the lenders may charge an arrangement and exit fee.
 

At Crown Financial Ltd, we have access to over 150 lenders to secure you the best possible deal. we have an excellent relationship with a broad panel of diverse development lenders who we can approach to obtain your desirable terms according to your circumstances, needs and requirements.


Have a more specific question you need answered? Ask our mortgage experts by clicking the button below.

 
Click here to book free no obligation chat and one of our advisers will be in touch as quickly as possible.

CROWN FINANCIAL LTD

  • Crown Financial Ltd (FCA No.959847) is an Appointed Representative of Connect IFA Ltd (FCA No. 441505) which is Authorised and Regulated by the Financial Conduct Authority  and is entered on the financial services register (https://register.fca.org.uk/) under reference 959847. The FCA does not regulate some forms of Business Buy to Let Mortgages and Commercial Mortgages to Limited Companies. The guidance and/or advice contained within this website is subject to the UK regulatory regime and is therefore primarily targeted at consumers based in the UK.                               
  • Crown Financial Ltd Registered Office: 118B, Gubbins Lane, Romford, RM3 0DR. Company Registered in England and Wales Reg. 13486324. Crown Financial Ltd is registered with the Information Commissioner’s Office under registration reference: ZB243625. Copyright © 2021 All Rights Reserved.
  • A fee will be payable for arranging your mortgage with Crown Financial Ltd. The amount of the fee will depend upon your circumstances and will be discussed and agreed with you at the earliest opportunity, but this is typically 0.5% of the mortgage balance, e.g. £500 for a mortgage of £100000. Initial consultation is always free.
  • A fee of (minimum £99 – £199) is payable at the outset when you apply for the mortgage.
  • We don’t charge any fee for insurance services. 
  • Commission disclosure: We are a credit broker and not a lender. We have access to an extensive range of lenders. Once we have assessed your needs, we will recommend a lender(s) that provides suitable products to meet your personal circumstances and requirements, though you are not obliged to take our advice or recommendation. Whichever lender we introduce you to, we will typically receive commission from them after completion of the transaction. The amount of commission we receive will normally be a fixed percentage of the amount you borrow from the lender. Commission paid to us may vary in amount depending on the lender and product. The lenders we work with pay commission at different rates. However, the amount of commission that we receive from a lender does not have an effect on the amount that you pay to that lender under your credit agreement.
  • Making a Complaint: It is our intention to provide you with a high level of customer service at all times.  If there is an occasion when we do not meet these standards and you wish to register a complaint, please write to: Compliance Department; Connect IFA Ltd, 39 Station Lane, Hornchurch, RM12 6JL or call: 01708 676110. If you cannot settle your complaint with us, you may be entitled to refer it to the Financial Ombudsman Service www.financial-ombudsman.org.uk
 
  • Your home may be repossessed if you do not keep up repayments on your mortgage or loans secured on it.