Last week we welcomed a group of our brokers to LendInvest HQ for our first Broker Breakfast.
We understand that when it comes to making the best decisions for your borrowers, education is paramount. Making the loan process as transparent as possible allows all parties to speed up procedures and get the borrowers funds over to them as fast as possible. This session we explored how to get your development costs right before loan application.
Our first speaker, Steve Larkin, Director of Development Finance at LendInvest gave us a run down of the growing role of development loans within the business.
From application to completion, the structure of the process remains predominantly commercial, as the team still need to adhere to the same checks and procedures as traditional loan providers.
“For initial assessment, what documents are required?
“We need the address of the property, the borrower’s ‘CV’ detailing their previous experience, and the development appraisal.”
As speed is the differentiator for us, ensuring all of the clients documents are presented at initial assessment is key for the development team to do their job.
Next up we heard from Blane Perrotton, a Director at Naismiths, the consultancy arm that carries out our quantity surveying.
“What are the key development costs that should be planned for?
“You should always consider: construction costs, professional fees, contingency costs and additional costs such as marketing, CIL payments and S106 costs.”
Considering the common causes of project failure allows you to foresee a problem in the borrower’s plan before it even reaches the lender.
Looking out for borrowers with an inadequate budget, an incomplete or poorly coordinated design, late and poorly coordinated design or unsuitable consultants and querying these issues can save time for both the lender and the borrower.
Having a comprehensive view of all of a client’s development costs with the ability to review your borrower’s proposal puts you at an immediate advantage.
Interested in attending one of our future Broker Breakfasts?
To learn more about Development Finance and how it can benefit your clients, contact us.