What is Development Exit Finance?

With the 2020 Coronavirus pandemic creating many disruptions across the construction industry, Development Exit finance has never been so popular. With many developers looking to extend their loans, and exit onto cheaper finance, the demand for these types of products has increased dramatically.

Most lenders have withdrawn 75-80% Loan to Gross Development Value (LTGDV) development products and have increased rates to mitigate the risk associated with the current market conditions. Let’s explore what development exit finance is and how it can potentially help you.

What is Development Exit finance?

Developer Exit Finance is designed to help you refinance your current development loan onto a new and often cheaper finance product.

    FiWhen is Development Exit Finance applicable?

    You are approaching the end of term with the current lender.

    Developers shouldn’t be put in a position where they need to sell quickly or feel under pressure to sell at discounts, as this can erode profits. Developer exit loans can provide the time needed to market and sell any remaining units. With no exit fees, and interest accruing daily, you can repay the loan as quickly as you wish.

    You want to release cash to work on other projects.

    We can facilitate the release of capital to allow you to inject into the next deal / development. Development exit finance is a great way to access capital that would be tied up until the sale of the development.

    Benefits of Exit Finance:

    • Up to 75 LTV%
    • Arrangement Fees from 1% on developer exit products
    • Interest Rates from 0.44% per month
    • No exit fees or Early Repayment Charges
    • No Up Front Fees
    • Up to 36 months with development exit loans
    • Facilities for first time developers are available
    • Adverse Credit cases can be funded
    • Fast completions possible with exit finance
    • Interest can be rolled up, retained or paid monthly. 

    What is the criteria for Development Exit Finance?

    The development would have been built in line with the planning permission and building regulations. On completion, the development will have the relevant warranties in place. A first legal charge will be required on the property. Multiple unit developments preferred.