The biggest benefit of development finance is the way in which it allows borrowers to access much larger sums of money. In fact, it is the most extensive borrowing facility currently available on the UK market. Initially, funds are provided to get the project underway. As the project continues, grows and edges closer to reaching its goals, more money is released for the developer along the way. The total sum of money lent can be up to 100% of the total cost of construction, with no specific upper-limits as to how much can be borrowed.
Additional advantages to development finance include:
- The ability to secure money on properties, plots and developments that may be considered unsuitable or unviable by other lenders. This includes rundown and derelict buildings.
- Development finance can be repaid relatively quickly, keeping overall borrowing costs to absolute minimums. Far more affordable than many long-term borrowing facilities.
- Interest is only charged on the funds released which again can impact the overall costs of the facility in a positive way. A benefit of funds being released in stages throughout the project.
- No specific limitations on how much can be borrowed. If the project is deemed viable, development finance may be offered to cover up to 100% of the costs, irrespective of the total construction cost.
builders need funds fast !
House builders need funds fast to ensure they can keep on track with the building out of a site, the last thing they want to do is to be waiting around and stopping build progress whist they wait for more funds to pay for building materials and labour / services.
- Finance can be FAST !
- No monthly payments!
- funds in hand to pay for materials and labour