Development Finance

DEVELOPMENT FINANCE

Tranches of funds to heavy renovate, or build

Development finance is used when there is a significant amount of refurbishment works to be done to a property, or a build from scratch, or a knock down and rebuild.

It can be used on residential or commercial properties (or a mix), and it can be used for your own personal use, or something with a more commercial appetite.

The main difference between development finance and bridging finance is that the funds are released in tranches, and you can borrow against the uplift in value as the project progresses.

Whilst rates might be higher than bridging finance you’re only paying interest on the funds you’ve actually borrowed. For example; if you had a £200k bridging loan for 12 months at 1% per month you would pay £24,000 in interest. Whereas if you had £200k in development finance in a tranche of £100k funds for 6 months, then the additional £100k for months 6-12 at a rate of 1.2% per month, the interest would be £21,600.

This may be purchased in a limited company, individual name or a pension.

Whether you’ve done your research and just want to make sure you’re not missing a trick, or your situation is more complicated and you don’t know where to start, contact us today and let us help you.

‘Depending on your circumstances in this application, this may or may not be an FCA regulated product. Node will advise you prior to application whether it falls under FCA regulation or not’