Property Development Finance for Beginners

When people first start looking for property development finance they are confronted by a range of different options. One common misconception is that property development funding is only applicable to larger projects.

In fact, there are plenty of lenders willing to assist with quite modest refurbishment schemes. In one recent case a borrower with limited experience wanted to raise property development finance to convert a “House of Multiple Occupation” (HMO) back into a single dwelling. Whilst the lack of experience does not necessarily present too many challenges, the fact that the property was a grade two listed building was always going to add complications.

The challenge with listed building consent is the potential for the development to go over budget, very often planners will place conditions on the use of specific materials etc.. In this instance the broker in question was able to place deal with a specialist property development funder who was very happy to consider merits of the case.

All too often the client’s lack of experience in this type of project could have stopped the project moving forward.  In this particular case the lender and broker were very impressed by the clients determination and the quality of their preparation. Aside from the merits of the application the other major factor which allowed the conversion scheme to move forward was the borrowers willingness to work with their broker and to accommodate the lenders concerns

The main reason that this deal was able to proceed, was that the broker and client established a good rapport and understanding of what could be realistically achieved.

[tags]uk property development finance, property funding[/tags]

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