What Can Property Development Finance Be Used For?
Bringing things back to basics, we answer the “simple” questions, what is property development funding and what can property development finance be used for?
What Is Property Development Finance?
Development finance provides the necessary capital to cover the costs associated with land acquisition, construction, materials, labour, and other expenses involved in the development process of building or restoring houses, flats, and other commercial and residential properties.
The amount of funding will vary depending on the lender. For example, Onyx will lend up to 75% of the gross development value. This funding can contribute to both the purchase and build costs.
The lender will typically look to take chargeable property security to support loans. This can range from first charges over development sites, first and second charges over guarantor properties, company charges, and debentures. However, loans can also be offered to high net worth individuals (HNWs) with specialist items such as luxury cars, watches, and fine art used as security.
What Can Property Development Finance Be Used For?
Developers and investors can apply for property development loans for all types of projects and plans. This can include anything from ground-up (buy the land and build houses from scratch), to refurbishments (do up existing properties), bridging (short loan), and multi-site.
Check out our blog on frequently asked questions from our clients to get more information on property development loans. You can also get a feel for the application process here and a property development finance checklist here.
Property Development Finance Examples
Using examples from our loan books, Onyx has provided the following with property development funding. Click on the case studies to get a bigger picture of how they used their finance to grow their investments.
What Other Options Are Available Other Than Property Development Funding?
If the borrower only requires finance for a short period before selling or securing longer-term financing such as a mortgage, they can apply for a bridging loan. A common use for bridging loans for example are loans for property auctions. We explain all about bridging loans here.
Onyx Property Finance are experts in providing financial solutions for property developers. We are dedicated to keeping on top of market trends and ensuring our customers are kept informed of any changes that might affect their borrowing, projects, and investments – see our blog for all the latest insights.
Speak to an expert today and get property development finance to fund your purchase and build costs with fixed interest rates for the lifetime of your loan: info@onyxmoney.co.uk.