Development Finance
Are you a Property Developer looking for your next project? Speak with the experts today...
Property Development is a type of lending designed to provide developers with access to capital to complete various sized projects, such as duplexes, townhouses, unit blocks, high density dwellings and commercial developments. These types of lends require specialist bank, non-bank and private support to assist, with terms often driven by Loan to Value Ratio's (LVRs), feasibilities and Gross Realisation Values (GRV's) that align with the chosen lenders' appetitie.
We use our 25+ years of commercial banking experience to guide developers around the best way to structure their facilities to access the capital they require. We often run a tender process to understand the appetite from across the banking landscape, to allow us to make informed decisions on the best lending parter for the project.
We tell clients that it's not the colour of the bank that determines credit outcomes, but rather the quality of the information and discussion paper you submit to the RIGHT BANKER at the RIGHT BANK having the RIGHT CONVERSATIONS that safeguards credit outcomes. We use our extensive network to ensure we align ourselves with active proficient bankers to ensure we achieve our goals.
The Evoke Difference
- Strategic structuring advice from award-winning mortgage brokers and property investors with 50+ yrs experience.
- Access 100+ lenders and the best interest rates in the market at absolutley no cost to you.
- Fast approvals via our platnium bank status to get you the right outcomes quickly.
- Fully digital application process where you can track your loan application in real time.
- 6-monthly interest rate reviews and annual strategy sessions to provide peace of mind and keep you on track.
- 100% 5 Star Google Reviews
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What is Development Finance?
Development finance is a type of funding specifically designed to cover the costs associated with property development. This can include residential, commercial, or mixed-use developments and covers expenses such as land acquisition, construction costs, and other related expenditures.
What types of projects can development finance be used for?
Development finance can be used for a variety of projects including:
- Residential housing developments
- Commercial properties like office buildings and retail centers
- Mixed-use developments
- Renovations and refurbishments
- Land subdivisions
Who can apply for development finance?
Development finance is typically available to property developers, investors, and builders. Both experienced and first-time developers can apply, although experience in the industry can enhance your application.
What are the key benefits of development finance?
Some key benefits include:
- Access to larger sums of capital
- Tailored repayment plans aligned with project timelines
- Interest-only payment options during the development phase
- Flexibility to cover various stages of the development
How is the amount of development finance determined?
The amount of finance available is usually determined based on the Gross Development Value (GDV) of the project, which is the anticipated market value of the completed development. Lenders may provide up to a certain percentage of the GDV, often between 60-80%.
What is the typical loan term for development finance?
Development finance loans are generally short-term, typically lasting between 12 to 36 months, depending on the size and complexity of the project.
What security is required for development finance?
Lenders usually require a first charge over the property being developed as security. They may also consider additional security in the form of personal guarantees or other assets.
How does the application process work?
The application process involves:
- Submitting a detailed feasibility, including a project plan, budgets, timelines, and planning permissions.
- Providing financial details and experience in property development.
- Lender evaluation of the project's viability and risk assessment.
- Approval and release of funds in stages, often linked to project milestones.
What are the interest rates for development finance?
Interest rates for development finance vary based on the lender, the size of the project, and the borrower's experience and creditworthiness. Typically, rates are higher than standard mortgages due to the increased risk associated with development projects.
Can development finance cover costs like planning and legal fees?
Yes, development finance can cover soft costs such as planning fees, architectural fees, legal costs, and other professional fees related to the development process.
How can I improve my chances of securing development finance?
- Present a detailed and realistic project plan.
- Highlight your experience and track record in property development.
- Show evidence of demand for the completed project.
- Demonstrate sound financial management and a strong credit history.
- Working with the right broker to enhance your approval outcomes.
Disclaimer: Subject to the lender's terms & conditions and credit approval criteria. Please ensure you seek your own personal legal and taxation advice for your situation.