Property development finance helps property developers gain the sufficient funds to complete their building projects. The land or property is used to secure the loan against, and in most cases requires the site to have planning permission before work can commence.

Once approved, the funding is released at set stages in the project as the work is completed. The first drawn down is given when the property is first purchased. The amount given at each stage is worked out by Lloyds surveyor reporters.

Property development finance is often considered the better alternative to a commercial mortgage or buy to let mortgage by many property developers, here’s why:

• No upper-limit on borrow amount
• Same day decision on application
• Available for all types of property
• Low arrangement fees
• Up to 90% of all costs covered
• Available anywhere in the UK (And for Non-UK residents)
• Interest is paid at the end of the loan
• Fast release of funds
• First time developers can be accepted for finance
• Poor/Adverse credit is normally okay
• No income proof required

More experienced property developers use property development finance as a way to secure equity on multiple properties with the same money down. Expanding their portfolio whilst minimizing the risk should a particular area experienced a downturn in the market. It also allows them more profit in the long term.

A minimum of £50,000 must be borrowed with lending times ranging from 3-18 months depending on the project size.

Lloyds prefers each scheme to be placed inside of an SPV (special purpose vehicle) and the funding is available to Limited companies, Limited liability partnerships and Individuals.

The interest rates are usually between 5%-12% depending on the property developers experience, the type of project, the loan amount and the location.

If you’re in need of funding for your property development, then Lloyds property development finance may be perfect for you.