There are many different ways to get funding for your development and it can be tricky to know where to start. From large developments to smaller builds financing is always an integral part of any development process and it is essential that you find the right funding for yours. Whether you are an experienced and established investor or developer, or you are just getting started in the business, here are a few things everyone should know about property development finance to get you going.
What is property development finance?
Property development finance refers to the loans and funding available for a wide range of projects and includes a variety of options, so it is important to know what kind is the best for you. Depending on the size of your operation, whether you are building from the ground up or renovating an existing property and the length of time you are looking at can all impact which kind of property development funding you should consider. Bridging or development finance are most often used for developments especially where there will be construction and therefore construction costs that must be met.
How do you go about getting funding?
Once you have an idea of the type of funding you require it is necessary to give yourself the best chance of getting that funding and at the best rate. In some cases your credit score will play a bigger role while in others it will be about the current and potential value of the land or property that you are developing, so it is a good idea to have as much information as you can to hand complete with proof.
A well filled-in form will go a long way to securing your financing, but just how easy it is in the end will depend on the type of development you are involved in and the kind of financing you are looking for. If you are refurbishing or renovating an existing property a light or heavy refurbishment loan would likely be easier to secure. This is based a great deal on the value of the building.
If you are looking for ground-up development finance this is where your plan and clearly laid out timetable for progress will become important. In the case of an entirely new build showing the potential value and how exactly you plan to get your development to that point is key to securing funding. You will need planning permission, an inspector to confirm what you have said and a plan to stay on schedule. Once your project is completed you can pay back the loan, knowing in the meantime that you have the capital to pay for any construction materials and other costs that you may have.
Whichever type of development you are looking at from a single property to an industrial estate, make sure that you have all of the information you can gather, set out a timetable and a plan and get the right kind of financing to see your ideas become a reality today.