{Speak to an Expert=d69d5563-8cfc-4eee-a8e2-1be9747840eb, Request a quote=85f9f070-0f3d-416b-ad31-ceec60432f9c}
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Key product features

  • Loan-to-Value is typically up to 65% of the Gross Development Value - but higher can be arranged.
  • Locations covering England, Scotland, and Wales
  • Single dwellings and multi-unit schemes considered
  • Offer interest on a rolled-up basis on many products
  • Residential, commercial, and mixed-use schemes considered
  • Funding is available to both experienced developers and those newer to property development
  • Efficient application process
  • Loans from £150,000 to £25,000,000 available
  • Build costs available up to 100%
  • Land purchases are available up to 60%
  • Highly personal service from start to finish
  • 24-month terms available

Helping property developers to;

We can help property developers to:

  • Achieve funding at the pre-planning stage without authorised planning permission
  • Use completed developments to unlock equity, pending sale of the property
  • Stretch senior products up to 90% Loan-to-Cost
  • Cover refurbishments and conversions as well as ground-up developments
  • Facilitate meetings between lender and developer to help the process move forward

Uses

Delivering finance based upon gross development value (GDV), development finance provides an opportunity to generate funds for property refurbishment or construction projects including:

We have access to a comprehensive lender panel specialising in financing ground-up property projects for property developers. These funds can be used to purchase land or property, to complete the project, and to pay contractors or suppliers.

We understand that large-scale developments have tight time frames and complex needs, and whether you are an experienced developer or even taking your first steps into the world of property, there is a lot to consider on a project of this scale. 

Development finance is typically released in stages to be drawn down as the project progresses and facilitates cash flow throughout the development project.

This development option covers heavy work to an existing building and can cover everything from large-scale structural works to complete refurbishments.

This type of finance is also ideal for HMO/BTL/PD conversions in residential properties. 

Why choose Aria?

Over 20 years of experience

Our expert team have over 20 years of experience in bridging finance and the specialist distribution industry and works on your behalf to provide access to market-leading rates with rapid loan completion as standard.


  • We handle every element of your enquiry from application to completion to take the stress out of the mortgage process.
  • With one quick and easy call or online application, we can review your client's needs and work with a panel of lenders to tailor a finance solution perfect for their needs.
Send your enquiry: Speak to an Expert

Experts

20+ years in the industry

First class service

We handle every element of your enquiry from application to completion to take the stress out of the mortgage process

Access to 100+ lenders

Our extensive lending panel stretches across the high street, challenger banks, offering you unrivalled access to a wide range of products and rates

High conversion rate

With one quick and easy call or online application, we can review your client's needs and work with a panel of lenders to tailor a finance solution perfect for their needs

Point of contact

We offer one point of contact from enquiry through to completion, always aiming to make the process as smooth as possible

{"limit":1000,"message":null,"objects":[{"answer":"
    \n
  • Property development finance is a type of short-term, secured finance that is used for many small, medium, and large-scale property projects, including renovations, office block conversions or to purchase and build on previously undeveloped land from the ground up.
  • \n
  • Development finance is used by many different types of people from private individuals to portfolio developers and small to large companies
  • \n
  • Unlike a traditional mortgage, development finance is a short to medium-term loan that is secured against the projected gross value rather than the current value of the land/property. It can be complicated so it is beneficial to use an experienced broker, like Aria Finance.
  • \n
","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1660837372108,"hs_deleted_at":0,"hs_id":82356730211,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1664548973147,"hs_updated_by_user_id":25791956,"products":[{"id":2,"label":"development-finance","labelTranslations":null,"name":"development-finance","order":1,"type":"option"}],"question":"What is Development Finance?","sub_category":{"id":1,"label":"The Basics","labelTranslations":null,"name":"The Basics","order":0,"type":"option"}},{"answer":"Any individual or limited company can apply for development finance.","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1660837422367,"hs_deleted_at":0,"hs_id":82356730212,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1662126259398,"hs_updated_by_user_id":25791956,"products":[{"id":2,"label":"development-finance","labelTranslations":null,"name":"development-finance","order":1,"type":"option"}],"question":"Who can apply for Development Finance?","sub_category":{"id":1,"label":"The Basics","labelTranslations":null,"name":"The Basics","order":0,"type":"option"}},{"answer":"Development finance can be arranged for residential properties like townhouses and flats, new builds and terraced houses, commercial properties such as warehouses, factories, shops and offices, as well as semi-commercial or mixed-use developments.","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1660837453914,"hs_deleted_at":0,"hs_id":82356730213,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1662556937265,"hs_updated_by_user_id":25791956,"products":[{"id":2,"label":"development-finance","labelTranslations":null,"name":"development-finance","order":1,"type":"option"}],"question":"What does Development Finance cover?","sub_category":{"id":1,"label":"The Basics","labelTranslations":null,"name":"The Basics","order":0,"type":"option"}},{"answer":"There is no maximum borrowing when it comes to development finance. Development finance is typically reliant on a valuation assessment of the project that is planned, once all the works will have been completed – the Gross Development Value (GDV).","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1660837492053,"hs_deleted_at":0,"hs_id":82356730215,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1662126262307,"hs_updated_by_user_id":25791956,"products":[{"id":2,"label":"development-finance","labelTranslations":null,"name":"development-finance","order":1,"type":"option"}],"question":"How are Development Finance rates calculated?","sub_category":{"id":1,"label":"The Basics","labelTranslations":null,"name":"The Basics","order":0,"type":"option"}},{"answer":"Typically, the loan cannot be taken altogether upfront but is drawn-down in tranches as stages of the development are complete. Often the lender will insist upon this, and interest is usually charged based on the amount drawn down at any one time.","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1660837649677,"hs_deleted_at":0,"hs_id":82356730218,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1662126263824,"hs_updated_by_user_id":25791956,"products":[{"id":2,"label":"development-finance","labelTranslations":null,"name":"development-finance","order":1,"type":"option"}],"question":"Do Development Finance loans have to be taken all at once?","sub_category":{"id":1,"label":"The Basics","labelTranslations":null,"name":"The Basics","order":0,"type":"option"}},{"answer":"Depending on the lender, development finance can be used for a broad range of properties including residential, commercial, mixed-use, single and multiple units, ground-up new-build developments, conversions and renovations and development-to-let.","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1661934464240,"hs_deleted_at":0,"hs_id":83526019746,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1662126321017,"hs_updated_by_user_id":25791956,"products":[{"id":2,"label":"development-finance","labelTranslations":null,"name":"development-finance","order":1,"type":"option"}],"question":"What types of projects can Development Finance be used for?","sub_category":{"id":1,"label":"The Basics","labelTranslations":null,"name":"The Basics","order":0,"type":"option"}},{"answer":"Subject to lender criteria, typically an individual or limited company can apply for development finance. Many lenders will only lend to those who are able to evidence previous experience of successfully completing an equivalent development project.","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1661934688701,"hs_deleted_at":0,"hs_id":83496505977,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1662126322867,"hs_updated_by_user_id":25791956,"products":[{"id":2,"label":"development-finance","labelTranslations":null,"name":"development-finance","order":1,"type":"option"}],"question":"Who can access Development Finance?","sub_category":{"id":1,"label":"The Basics","labelTranslations":null,"name":"The Basics","order":0,"type":"option"}},{"answer":"

Three important factors will be assessed for an idea of loan size

\n\n
    \n
  • The current value of the site with planning or the value of the property before works.
  • \n
  • The build costs
  • \n
  • The gross development value (GDV) is the end value of a property once works have been completed
  • \n
\n

Typically, lenders will consider up to 65% of the gross development value and up to 100% of the build costs. Many lenders may not consider an application if the total build costs are more than 75% of the GDV. Loan terms are typically up to 18 months.

\n

The size of the loan amount obtainable will also vary with lenders. Aria Finance have experience in funding projects which range anywhere from £150,000 to £25,000,000.

","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1661934718042,"hs_deleted_at":0,"hs_id":83526019756,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1662126324073,"hs_updated_by_user_id":25791956,"products":[{"id":2,"label":"development-finance","labelTranslations":null,"name":"development-finance","order":1,"type":"option"}],"question":"How much money can be borrowed with Development Finance?","sub_category":{"id":1,"label":"The Basics","labelTranslations":null,"name":"The Basics","order":0,"type":"option"}},{"answer":"Development finance is typically structured in two stages. This begins with the initial day one loan which helps get the project underway. Lenders will consider up to 60% of land purchase price at this stage. Then, the rest of the loan is then drawn down in stages depending on the progress of the project (upon certification from a monitoring surveyor).","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1661934852547,"hs_deleted_at":0,"hs_id":83526019758,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1662126326494,"hs_updated_by_user_id":25791956,"products":[{"id":2,"label":"development-finance","labelTranslations":null,"name":"development-finance","order":1,"type":"option"}],"question":"How is Development Finance structured? ","sub_category":{"id":1,"label":"The Basics","labelTranslations":null,"name":"The Basics","order":0,"type":"option"}},{"answer":"

Interest rates will be calculated by

\n\n
    \n
  • The amount borrowed
  • \n
  • The percentage borrowed against the overall costs – current value and build costs combined
  • \n
  • The loan term required Interest rates typically start at 5.5% and are often calculated annually.
  • \n
","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1661934900085,"hs_deleted_at":0,"hs_id":83526019760,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1662126329139,"hs_updated_by_user_id":25791956,"products":[{"id":2,"label":"development-finance","labelTranslations":null,"name":"development-finance","order":1,"type":"option"}],"question":"How is interest calculated on Development Finance?","sub_category":{"id":1,"label":"The Basics","labelTranslations":null,"name":"The Basics","order":0,"type":"option"}},{"answer":"

These fees will vary across the market

\n\n
    \n
  • Broker fee – This varies between brokers. Some brokers do not charge a fee and rely on receiving commission from lenders when the loan completes. Other brokers may charge a fixed fee or a percentage of the total loan value.
  • \n
  • Application fee – Some lenders and brokers charge for submitting an application
  • \n
  • Valuation fee – To calculate an unbiased, accurate value of the security, lenders will typically instruct an independent valuation. This can also include a projected valuation of the project once completed
  • \n
  • Arrangement fee – Often calculated as a percentage of the total cost of the loan
  • \n
  • Monitoring fees – Development projects are monitored for progress and this typically involves a cost.
  • \n
  • Drawdown fees- A fee charged whenever a new instalment of funds is transferred to the borrower
  • \n
  • Legal fees – If needed, borrowers will have to pay for legal costs such as hiring a solicitor or qualified legal advice
  • \n
  • Exit fee – Often calculated as a percentage of the total cost of the loan
  • \n
  • Administration fees - Any additional costs charged by either lender or broker
  • \n
","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1661934991318,"hs_deleted_at":0,"hs_id":83526019880,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1662126330691,"hs_updated_by_user_id":25791956,"products":[{"id":2,"label":"development-finance","labelTranslations":null,"name":"development-finance","order":1,"type":"option"}],"question":"What fees can I expect with Development Finance?","sub_category":{"id":1,"label":"The Basics","labelTranslations":null,"name":"The Basics","order":0,"type":"option"}},{"answer":"Development finance is only regulated when the borrower, a family member or other close person is planning to live in or currently resides in the property. At least 40% of the property will have to be used for residential use in order to qualify for FCA regulation.","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1661935052973,"hs_deleted_at":0,"hs_id":83496506011,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1662126332568,"hs_updated_by_user_id":25791956,"products":[{"id":2,"label":"development-finance","labelTranslations":null,"name":"development-finance","order":1,"type":"option"}],"question":"Is Development Finance regulated?","sub_category":{"id":1,"label":"The Basics","labelTranslations":null,"name":"The Basics","order":0,"type":"option"}},{"answer":"

This is the typical process with a broker...

\n\n
    \n
  • Enquiry for capital raising raised by the client
  • \n
  • The broker then reviews mortgage options
  • \n
  • If development finance is considered most suitable, the broker will typically refer the case to a specialist finance distributor (SFD) who may have wider access to development finance lenders and more competitive rates o The broker will inform the client that they are being referred to an SFD. They should also discuss with their clients all costs, fees and charges, required documentation, the importance of transparency and the desired exit route.
  • \n
  • The SFD then reviews the key case details and...
  • \n
  • Assigns the case to an underwriter who assesses the initial suitability of the application
  • \n
  • Indicative terms are sent to the client, their broker and an agreement letter to proceed for the client to sign and return
  • \n
  • The client is then sent paperwork with a checklist of supporting documents to return to the specialist finance distributor
  • \n
  • A third-party surveyor instructed by the SFD visits the site to determine the project’s plausibility – and a valuer for the project’s total value
  • \n
  • The formal loan offer and final terms are then sent to the client. At this point, the client may involve their solicitor for legal support and advice on whether to proceed. The loan completes and the day one loan is drawn • This is followed by further drawdowns until the project is complete
  • \n
","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1661935172445,"hs_deleted_at":0,"hs_id":83526019934,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1662126334623,"hs_updated_by_user_id":25791956,"products":[{"id":2,"label":"development-finance","labelTranslations":null,"name":"development-finance","order":1,"type":"option"}],"question":"How does the application process work for Development Finance?","sub_category":{"id":1,"label":"The Basics","labelTranslations":null,"name":"The Basics","order":0,"type":"option"}},{"answer":"Typically, development finance is exited through refinance or sale of the property. Refinance quite often involves the developer exiting onto a longer-term loan facility where they retain ownership of the property and rent it out to repay the loan. Cash redemption is also an acceptable exit route if the applicant is able to show evidence of a cash event substantial enough to clear the loan occurring within the term. Investment portfolio maturity, pension lump sum or other cash events are typically considered.","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1661935218835,"hs_deleted_at":0,"hs_id":83526019937,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1662126336521,"hs_updated_by_user_id":25791956,"products":[{"id":2,"label":"development-finance","labelTranslations":null,"name":"development-finance","order":1,"type":"option"}],"question":"What are Development Finance exit routes?","sub_category":{"id":1,"label":"The Basics","labelTranslations":null,"name":"The Basics","order":0,"type":"option"}},{"answer":"

Heavy refurbishment bridging/ development finance offers clients an opportunity to secure funds to assist with the purchase (or remortgage) of a property and typically covers 100% of the build costs.

\n

Developers and other property investors often have their funds tied up in existing projects or property. A heavy refurb bridge or development product can be a great way to help them move onto their next project without having to wait for the existing ones to sell or pulling money out of those properties.

\n

During a refurbishment project, cashflow for your client is likely to be limited. Most lenders will allow the interest to be rolled up into the loan, meaning that there's no monthly payments due on the loan, freeing up their cash whilst property undergoes work and isn't generating them any income. 

\n

Loans can be arranged and the pre-planning stage, or once planning is granted; then Aria Finance helps facilitate the funding process and enables your client to bring their desired projects to life.

","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1694511591229,"hs_created_by_user_id":25791956,"hs_deleted_at":0,"hs_id":134538432831,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1694512393963,"hs_updated_by_user_id":25791956,"products":[{"id":2,"label":"development-finance","labelTranslations":null,"name":"development-finance","order":1,"type":"option"}],"question":"How can Heavy Refurbishment Finance benefit your clients?","sub_category":{"id":1,"label":"The Basics","labelTranslations":null,"name":"The Basics","order":0,"type":"option"}},{"answer":"

Your client's track record (i.e., their history with previous projects); if they don't have experience themselves, then lenders will look to understand who the client's main contractor will be and what projects they've completed, to ensure that the development will run smoothly.

\n

The viability of the project, including:

\n
    \n
  • Location
  • \n
  • Market demand
  • \n
  • Total costs for the project including the purchase price, build costs, professional fees
  • \n
  • What the property will be worth on completion (GDV)
  • \n
  • The client's ability to repay the loan at the end of the term, whether it be via sale or refinance
  • \n
\n

Each lender has specific criteria which must be considered during the application process. At Aria Finance, we have a panel of lenders carefully selected to help clients with a variety of projects and with varying development experience.

","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1694512396075,"hs_created_by_user_id":25791956,"hs_deleted_at":0,"hs_id":134544646552,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1694512722545,"hs_updated_by_user_id":25791956,"products":[{"id":2,"label":"development-finance","labelTranslations":null,"name":"development-finance","order":1,"type":"option"}],"question":"What factors are considered when evaluating your clients' applications for Heavy Refurbishment Finance?","sub_category":{"id":4,"label":"Applications Process","labelTranslations":null,"name":"Applications Process","order":3,"type":"option"}},{"answer":"Yes, we can arrange funding for all types of property projects, Whether it's a quick 'tart & turn' or a more complex refurbishment, conversion or ground-up development. We have solutions to meet your client's needs.","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1694512727950,"hs_created_by_user_id":25791956,"hs_deleted_at":0,"hs_id":134544646559,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1694512881357,"hs_updated_by_user_id":25791956,"products":[{"id":2,"label":"development-finance","labelTranslations":null,"name":"development-finance","order":1,"type":"option"}],"question":"Can my client get refunding for Ground Up Development projects?","sub_category":{"id":1,"label":"The Basics","labelTranslations":null,"name":"The Basics","order":0,"type":"option"}},{"answer":"

Ground-up Development Finance offers developers an opportunity to secure funds to assist with the purchase (or remortgage) of property or land, and typically covers 100% of the build costs.

\n

Developers often have their own funds tied up in existing projects, and development finance can be a greater way to help them move onto their next project without having to wait for the existing ones to sell. 

\n

For newer clients coming into the industry, it also allows them the opportunity to have the cashflow to complete their project whilst also having the experience and guidance of the lenders to help seem them through the build. 

\n

Loans can be arranged at the pre-planning stage, or once planning is granted then; Aria helps facilitate the funding process and enables developers to bring their desired projects to life.

","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1694512937192,"hs_created_by_user_id":25791956,"hs_deleted_at":0,"hs_id":134544646563,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1694514752274,"hs_updated_by_user_id":25791956,"products":[{"id":2,"label":"development-finance","labelTranslations":null,"name":"development-finance","order":1,"type":"option"}],"question":"How can Ground-Up Development Finance benefit your developer clients?","sub_category":{"id":1,"label":"The Basics","labelTranslations":null,"name":"The Basics","order":0,"type":"option"}},{"answer":"

Your client's track record (i.e., their history with previous projects); if they don't have experience themselves, then lenders will look to understand who the client's main contractor will be and what projects they've completed, to ensure that the development will run smoothly.

\n

The viability of the project, including:

\n
    \n
  • Location 
  • \n
  • Market demand
  • \n
  • Total costs for the development including the purchase price, build costs, professional fees
  • \n
  • What the property will be worth on completion (GDV)
  • \n
  • The client's ability to repay the loan at the end of the term, whether it be via sale or refinance
  • \n
\n

Each lender has specific criteria which must be considered during the application process. At Aria Finance, we have a panel of lenders carefully selected to help clients with a variety of projects and with varying development experience.

","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1694514754366,"hs_created_by_user_id":25791956,"hs_deleted_at":0,"hs_id":134546045286,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1694515588715,"hs_updated_by_user_id":25791956,"products":[{"id":2,"label":"development-finance","labelTranslations":null,"name":"development-finance","order":1,"type":"option"}],"question":"What factors are considered when evaluating your clients' application for Ground-up Development Finance?","sub_category":{"id":4,"label":"Applications Process","labelTranslations":null,"name":"Applications Process","order":3,"type":"option"}},{"answer":"Yes, we can arrange funding for all types of property refurbishment projects. Whether it's a quick 'tart & turn', or a more complex refurbishment or conversion requiring planning permission and structural alternations. We have solutions to meet your client's needs.","broker_specific":0,"hs_child_table_id":0,"hs_created_at":1694515677944,"hs_created_by_user_id":25791956,"hs_deleted_at":0,"hs_id":134520612198,"hs_is_edited":false,"hs_published_at":1708095516058,"hs_updated_at":1694516071966,"hs_updated_by_user_id":25791956,"products":[{"id":2,"label":"development-finance","labelTranslations":null,"name":"development-finance","order":1,"type":"option"}],"question":"Can my client get funding for property refurbushment projects?","sub_category":{"id":1,"label":"The Basics","labelTranslations":null,"name":"The Basics","order":0,"type":"option"}}],"offset":0,"total":20,"totalCount":20}
property-development 2

Development Finance

Frequently asked questions

What is Development Finance?
  • Property development finance is a type of short-term, secured finance that is used for many small, medium, and large-scale property projects, including renovations, office block conversions or to purchase and build on previously undeveloped land from the ground up.
  • Development finance is used by many different types of people from private individuals to portfolio developers and small to large companies
  • Unlike a traditional mortgage, development finance is a short to medium-term loan that is secured against the projected gross value rather than the current value of the land/property. It can be complicated so it is beneficial to use an experienced broker, like Aria Finance.
  • Property development finance is a type of short-term, secured finance that is used for many small, medium, and large-scale property projects, including renovations, office block conversions or to...
Who can apply for Development Finance?
Any individual or limited company can apply for development finance.
Any individual or limited company can apply for development finance.
What does Development Finance cover?
Development finance can be arranged for residential properties like townhouses and flats, new builds and terraced houses, commercial properties such as warehouses, factories, shops and offices, as well as semi-commercial or mixed-use developments.
Development finance can be arranged for residential properties like townhouses and flats, new builds and terraced houses, commercial properties such as warehouses, factories, shops and offices, as...
How are Development Finance rates calculated?
There is no maximum borrowing when it comes to development finance. Development finance is typically reliant on a valuation assessment of the project that is planned, once all the works will have been completed – the Gross Development Value (GDV).
There is no maximum borrowing when it comes to development finance. Development finance is typically reliant on a valuation assessment of the project that is planned, once all the works will have...
Do Development Finance loans have to be taken all at once?
Typically, the loan cannot be taken altogether upfront but is drawn-down in tranches as stages of the development are complete. Often the lender will insist upon this, and interest is usually charged based on the amount drawn down at any one time.
Typically, the loan cannot be taken altogether upfront but is drawn-down in tranches as stages of the development are complete. Often the lender will insist upon this, and interest is usually charged...
What types of projects can Development Finance be used for?
Depending on the lender, development finance can be used for a broad range of properties including residential, commercial, mixed-use, single and multiple units, ground-up new-build developments, conversions and renovations and development-to-let.
Depending on the lender, development finance can be used for a broad range of properties including residential, commercial, mixed-use, single and multiple units, ground-up new-build developments,...
Who can access Development Finance?
Subject to lender criteria, typically an individual or limited company can apply for development finance. Many lenders will only lend to those who are able to evidence previous experience of successfully completing an equivalent development project.
Subject to lender criteria, typically an individual or limited company can apply for development finance. Many lenders will only lend to those who are able to evidence previous experience of...
How much money can be borrowed with Development Finance?

Three important factors will be assessed for an idea of loan size

  • The current value of the site with planning or the value of the property before works.
  • The build costs
  • The gross development value (GDV) is the end value of a property once works have been completed

Typically, lenders will consider up to 65% of the gross development value and up to 100% of the build costs. Many lenders may not consider an application if the total build costs are more than 75% of the GDV. Loan terms are typically up to 18 months.

The size of the loan amount obtainable will also vary with lenders. Aria Finance have experience in funding projects which range anywhere from £150,000 to £25,000,000.

Three important factors will be assessed for an idea of loan size

  • The current value of the site with planning or the value of the property before works.
  • The build costs
  • The gross development value...
How is Development Finance structured?
Development finance is typically structured in two stages. This begins with the initial day one loan which helps get the project underway. Lenders will consider up to 60% of land purchase price at this stage. Then, the rest of the loan is then drawn down in stages depending on the progress of the project (upon certification from a monitoring surveyor).
Development finance is typically structured in two stages. This begins with the initial day one loan which helps get the project underway. Lenders will consider up to 60% of land purchase price at...
How is interest calculated on Development Finance?

Interest rates will be calculated by

  • The amount borrowed
  • The percentage borrowed against the overall costs – current value and build costs combined
  • The loan term required Interest rates typically start at 5.5% and are often calculated annually.

Interest rates will be calculated by

  • The amount borrowed
  • The percentage borrowed against the overall costs – current value and build costs combined
  • The loan term required Interest rates typically...
What fees can I expect with Development Finance?

These fees will vary across the market

  • Broker fee – This varies between brokers. Some brokers do not charge a fee and rely on receiving commission from lenders when the loan completes. Other brokers may charge a fixed fee or a percentage of the total loan value.
  • Application fee – Some lenders and brokers charge for submitting an application
  • Valuation fee – To calculate an unbiased, accurate value of the security, lenders will typically instruct an independent valuation. This can also include a projected valuation of the project once completed
  • Arrangement fee – Often calculated as a percentage of the total cost of the loan
  • Monitoring fees – Development projects are monitored for progress and this typically involves a cost.
  • Drawdown fees- A fee charged whenever a new instalment of funds is transferred to the borrower
  • Legal fees – If needed, borrowers will have to pay for legal costs such as hiring a solicitor or qualified legal advice
  • Exit fee – Often calculated as a percentage of the total cost of the loan
  • Administration fees - Any additional costs charged by either lender or broker

These fees will vary across the market

  • Broker fee – This varies between brokers. Some brokers do not charge a fee and rely on receiving commission from lenders when the loan completes. Other...
Is Development Finance regulated?
Development finance is only regulated when the borrower, a family member or other close person is planning to live in or currently resides in the property. At least 40% of the property will have to be used for residential use in order to qualify for FCA regulation.
Development finance is only regulated when the borrower, a family member or other close person is planning to live in or currently resides in the property. At least 40% of the property will have to...
How does the application process work for Development Finance?

This is the typical process with a broker...

  • Enquiry for capital raising raised by the client
  • The broker then reviews mortgage options
  • If development finance is considered most suitable, the broker will typically refer the case to a specialist finance distributor (SFD) who may have wider access to development finance lenders and more competitive rates o The broker will inform the client that they are being referred to an SFD. They should also discuss with their clients all costs, fees and charges, required documentation, the importance of transparency and the desired exit route.
  • The SFD then reviews the key case details and...
  • Assigns the case to an underwriter who assesses the initial suitability of the application
  • Indicative terms are sent to the client, their broker and an agreement letter to proceed for the client to sign and return
  • The client is then sent paperwork with a checklist of supporting documents to return to the specialist finance distributor
  • A third-party surveyor instructed by the SFD visits the site to determine the project’s plausibility – and a valuer for the project’s total value
  • The formal loan offer and final terms are then sent to the client. At this point, the client may involve their solicitor for legal support and advice on whether to proceed. The loan completes and the day one loan is drawn • This is followed by further drawdowns until the project is complete

This is the typical process with a broker...

  • Enquiry for capital raising raised by the client
  • The broker then reviews mortgage options
  • If development finance is considered most suitable, the broker...
What are Development Finance exit routes?
Typically, development finance is exited through refinance or sale of the property. Refinance quite often involves the developer exiting onto a longer-term loan facility where they retain ownership of the property and rent it out to repay the loan. Cash redemption is also an acceptable exit route if the applicant is able to show evidence of a cash event substantial enough to clear the loan occurring within the term. Investment portfolio maturity, pension lump sum or other cash events are typically considered.
Typically, development finance is exited through refinance or sale of the property. Refinance quite often involves the developer exiting onto a longer-term loan facility where they retain ownership...
How can Heavy Refurbishment Finance benefit your clients?

Heavy refurbishment bridging/ development finance offers clients an opportunity to secure funds to assist with the purchase (or remortgage) of a property and typically covers 100% of the build costs.

Developers and other property investors often have their funds tied up in existing projects or property. A heavy refurb bridge or development product can be a great way to help them move onto their next project without having to wait for the existing ones to sell or pulling money out of those properties.

During a refurbishment project, cashflow for your client is likely to be limited. Most lenders will allow the interest to be rolled up into the loan, meaning that there's no monthly payments due on the loan, freeing up their cash whilst property undergoes work and isn't generating them any income. 

Loans can be arranged and the pre-planning stage, or once planning is granted; then Aria Finance helps facilitate the funding process and enables your client to bring their desired projects to life.

Heavy refurbishment bridging/ development finance offers clients an opportunity to secure funds to assist with the purchase (or remortgage) of a property and typically covers 100% of the build costs.

What factors are considered when evaluating your clients' applications for Heavy Refurbishment Finance?

Your client's track record (i.e., their history with previous projects); if they don't have experience themselves, then lenders will look to understand who the client's main contractor will be and what projects they've completed, to ensure that the development will run smoothly.

The viability of the project, including:

  • Location
  • Market demand
  • Total costs for the project including the purchase price, build costs, professional fees
  • What the property will be worth on completion (GDV)
  • The client's ability to repay the loan at the end of the term, whether it be via sale or refinance

Each lender has specific criteria which must be considered during the application process. At Aria Finance, we have a panel of lenders carefully selected to help clients with a variety of projects and with varying development experience.

Your client's track record (i.e., their history with previous projects); if they don't have experience themselves, then lenders will look to understand who the client's main contractor will be and...

Can my client get refunding for Ground Up Development projects?
Yes, we can arrange funding for all types of property projects, Whether it's a quick 'tart & turn' or a more complex refurbishment, conversion or ground-up development. We have solutions to meet your client's needs.
Yes, we can arrange funding for all types of property projects, Whether it's a quick 'tart & turn' or a more complex refurbishment, conversion or ground-up development. We have solutions to meet your...
How can Ground-Up Development Finance benefit your developer clients?

Ground-up Development Finance offers developers an opportunity to secure funds to assist with the purchase (or remortgage) of property or land, and typically covers 100% of the build costs.

Developers often have their own funds tied up in existing projects, and development finance can be a greater way to help them move onto their next project without having to wait for the existing ones to sell. 

For newer clients coming into the industry, it also allows them the opportunity to have the cashflow to complete their project whilst also having the experience and guidance of the lenders to help seem them through the build. 

Loans can be arranged at the pre-planning stage, or once planning is granted then; Aria helps facilitate the funding process and enables developers to bring their desired projects to life.

Ground-up Development Finance offers developers an opportunity to secure funds to assist with the purchase (or remortgage) of property or land, and typically covers 100% of the build costs.

...

What factors are considered when evaluating your clients' application for Ground-up Development Finance?

Your client's track record (i.e., their history with previous projects); if they don't have experience themselves, then lenders will look to understand who the client's main contractor will be and what projects they've completed, to ensure that the development will run smoothly.

The viability of the project, including:

  • Location 
  • Market demand
  • Total costs for the development including the purchase price, build costs, professional fees
  • What the property will be worth on completion (GDV)
  • The client's ability to repay the loan at the end of the term, whether it be via sale or refinance

Each lender has specific criteria which must be considered during the application process. At Aria Finance, we have a panel of lenders carefully selected to help clients with a variety of projects and with varying development experience.

Your client's track record (i.e., their history with previous projects); if they don't have experience themselves, then lenders will look to understand who the client's main contractor will be and...

Can my client get funding for property refurbushment projects?
Yes, we can arrange funding for all types of property refurbishment projects. Whether it's a quick 'tart & turn', or a more complex refurbishment or conversion requiring planning permission and structural alternations. We have solutions to meet your client's needs.
Yes, we can arrange funding for all types of property refurbishment projects. Whether it's a quick 'tart & turn', or a more complex refurbishment or conversion requiring planning permission and...

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