Getting 100% finance for your property development project is possible – but not easy.
However there are ways you can increase your chances of getting that elusive full amount of funding.
Here’s our quick guide to getting 100% property development finance
Purchase a below market value (BMV) property
Usually 100% finance will only be offered to those most experienced in property development.
With experience comes knowledge and this will lead the developer to being able to see the potential in a property and realise it is a bargain.
Of course this is only a part of it and the individual has to find a lender willing to take the risk.
However they are more likely do so with a BMW property and the individual’s excellent track record to back them up.
But what if you can’t find a BMV or you don’t have a track record?
See point 4 (Using a broker) to find out how a good broker can help you bypass these issues.
Put forward additional security
If you are able to put up additional security against the loan then you are more likely to be approved for 100 percent property development finance.
Of course those developers who are experienced will know this but it can sometimes be overlooked by newbie developers.
Putting up an additional property against the loan can go a long way to securing the loan 100%.
Gross Development Funding
If you can prove the build costs are up to 70% of GDV of the development then some lenders will consider financing 100% of the build costs.
This will take a detailed knowledge of your scheme and detailed proof of the GDV.
The simplest, quickest and most effective solution… Use a broker
A broker will make everything easier.
First, they can help you with excellent advice on all of the above.
Secondly, they can advise you on how to increase your chances with a lender.
Thirdly, they will already have connections and a strong relationship with many lenders already known and prepared to offer 100% development finance.
This can save you lots of time and energy.
While you will usually have to payout for the fees a broker charges, at M3 Commercial Finance we don’t even charge new clients for their first deal with us, so you can try our service for free.
And even with fees you will still be able to save money because a broker can have access to lenders that you do not.
If you want to talk to us about finding 100% development finance for your property project, don’t hesitate to drop us a line for a quick chat.
You can contact us here