When it comes to getting 100 percent property development finance it can be difficult. However by going with a specialist and allowing them to search on your behalf you stand a much better chance of getting the full amount. There are three basic ways by which you can increase you chances of getting the full amount when it comes to getting finance. These are purchasing the property under verified market value, putting forward additional security and gross development lending. A broker will be able to give you excellent advice when it comes to all three and tell you how to increase your chances with a lender. A lender will usually work better with a broker than they would with an individual so this is one asset you will have by choosing to use one. While you will have to payout for the fees a broker charges you will still be able to save money because a broker can have access to lenders that you do not. They will be able to search with the whole of the market place to find a lender that is known to provide 100 percent property development finance. 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 the individual's excellent track record to back them up. 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 those with very little. Putting up an additional property against the loan can go a long way to securing the loan 100%. During the planning and building phase of the project in question an experienced property developer can see potential that those lacking experience can see. If you can forecast the value of the project after the building phase then a lender is more likely to offer 100%. This is especially so if a professional valuer takes a look at the project and can back you up. All of the above can go a long way to you securing 100 percent property development finance. Using a broker will also put you in good stead as opposed to going it alone. Lenders are more likely to work quickly with the broker than they are with the individual as the project will have been looked over and recommendations made. The biggest plus of going with the broker is they have the experience and know where to look and which lenders usually offer 100%. You can also take the advice of the broker when it comes to getting the cheapest interest rates. Rates will be based on the individuals experience and the proposition put to them. They will usually range between 1. 5% and 2. 5% above the Bank of England Base Rate.
Creamer Media's Mariaan Webb speaks to Engineering News editor Terence Creamer about the role that development finance institutions play in the South African economy.
