Development Loans
Property development is a continually evolving industry that is sensitive to sudden shifts in economic climate. This is why it is fundamental to ensure that you get the right financial advice and guidance from the very beginning. Whether you have 100% pre-sales or none at all, Iconiq Finance is the lending consultant and broker you need.
How do they work?
Development Loans
Understanding Development Loans
Property development finance is a loan that can help you fund construction of more than one property on one title. Most banks and lenders split property development into two parts, and both have very different approval processes, fees and charges, interest rates and risk assessments. These are:
- Residential - Most banks and lenders define residential property development as smaller-scale development, often up to four different units. This kind of mortgage can have standard fees and charges and is the less risky of the two.
- Commercial - If your property development is greater than four or five residential units, banks and lenders are likely to characterise it as commercial property development. This can be anything from a skyscraper to a series of commercial properties. These kinds of mortgage applications can be more complex, and often attract a higher interest rate to protect the bank or lender against risk.
