Residential Property Development case study
Background
Mr B (a fairly new developer) required funding for a property development project which involved building a substantial extension to a 3 bedroom detached cottage. The plan was to convert the cottage into a 5 bedroom, 3 bathroom, 3 living room home with an extensive landscaped garden. The project had already been granted planning permission and was due to be completed within 6 months.
Problem/Opportunity
All of our clients available funds were used in the purchase of the cottage for £300k. The development costs were approximately £200k so we had to find a lender willing to provide 100% development funding. Due to the higher costs involved in 100% development funding we forecasted their budget would require careful management and a swift conversion from developement to traditional mortgage funding at the completion of the build and fit out phase.
The Solution
We found a lender willing to fund the 100% development costs required and coordinated a conversion to a more traditional mortgage at the end of the development.
Key Benefit
Sourcing and negotiating funding for a 100% development project despite the fact there are not many lenders willing to provide 100% funding especially to fairly inexperienced developers
