We’ve written many guides to the different types of development finance available to prospective developers. But once you’ve decided which type of finance you require, it’s time to apply—which may leave you wondering what development finance lenders look for in a project or client.
Development finance lenders’ criteria has become stricter
Historically, securing development finance was quite simple; in a booming market, many development finance lenders were happy to lend without giving the projects in hand a thorough examination.
Now, the situation is different—stricter criteria and application processes mean detail is king. Development finance lenders will always look for a thoroughly filled out application with plenty of supporting information and high levels of research. Getting your facts and figures right is essential. Obviously, it’s impossible to predict all eventualities, but a strong contingency plan shows you’re prepared to deal with anything that crops up along the way. At this stage, there’s no such thing as too much preparation.
Although it is possible to secure development finance without prior experience—after all, all developers have to start somewhere—the process becomes easier the more development finance experience you have. It’s key to show this off in the right way to a potential lender; evidence of projects with figures and particulars will show the lender the level you have worked to before, giving them confidence in your ability to see through a successful project.
Of course, you should also show strong knowledge of factors external to your project, such as the local area, traffic links, amenities. You should have demonstrable market intelligence.
Your personal track record isn’t the only thing lenders will consider. The contractors you’re employing are also important, and you should be able to show their track record of success.
Your next step to ensure a development finance lender views your application favourably is approaching a reputable broker if you have not done so already. A good broker helps to facilitate the conversation, building the relationship between you and your lender. They may also have access to rates you cannot secure individually.
There are many development finance lenders currently operating, and we have access to a great number of these. Each lender has their own criteria and preferences for the type of client they like to lend to, so contact us for a further conversation today and we will talk you through your options.