Best Commercial Finance

Development loans can be loosely described as a type of finance that is used by a property developer to either construct new property, or renovate an old derelict property. As with any form of commercial finance, the application process is often complex and can take quite some time. People often mistakenly believe that developments loans are easy to apply for, in a similar fashion to personal forms of finance, this is simply not the case. Any application for commercial finance will be subject to a far different set of lending criteria to personal finance, and it is absolutely crucial that the person or company making the application is fully aware of these criteria and is capable of dealing with the lenders on equal terms.

Development loans for new construction projects actually consist of a paired package of loans, which work together to fund the development project. The first of these loans is the land loan. And is used to finance the purchase of the actual land plot the construction project will develop, this loan will usually stay active for the entire length of the project. The second loan is the development loan proper, and covers every cost associated with the actually construction phase, including all raw materials, professional fees and labour costs.

For development loans which are going to be used to finance the renovation or re-modelling of an existing property, things are usually more straightforward, one particular difference of development loans used for this purpose is the fact that the donor building will often contain enough equity to cover the loan value, meaning the lenders are going to see it as a reduced risk.

Whichever of these two purposes is the reason for your application for either type of development loans, you need to be aware of the fact that the application process is often very complicated. You will definitely be required to submit a well presented business plan which will prove the overall viability of the construction project. If you are an existing corporation you will also be asked to submit a set of independently audited corporate accounts along with full disclosure of shareholder and company officials.

It is highly recommended that you make use of the services of a professional commercial finance broker when seeking the best in development loans. A broker will have the knowledge and experience required to make sure that your application is as simple and streamlined as possible, they will be able to assist and advise upon the required documentation that will need to be giving in support of your application, and they will be able to speak the same language as the lenders.

Additionally, a commercial finance broker has access to a far greater number of potential lenders and a larger range of borrowing products than somebody applying directly. As your spokesman to the lenders, your broker will keep you advised of how your application is progressing as well as dealing with any problems which may arise.