Property developers are always looking at what options are available to help them finance their next project. This can be essential to ensure they keep their property pipeline moving. Because as we all know, time equals money.
Capital tied up in completed properties waiting to be sold may leave a developer without sufficient funds for their next project. This can take time, and slow turnaround can send costs skyrocketing.
In other words, access to alternative funding options is essential.
Have you considered developer exit?
Developer exit loans are a short-term financing option that allows developers to access finance on their completed properties before they’ve been sold. They then pay interest on the loan once the property’s purchased.
This option could help clients that have reached their exposure limit with their current lender, as they’ll be able to approach another lender for development finance. This allows the property developer to keep their pipeline moving and create new revenue, without the added pressures of having to sell below market value within a tight deadline.
Is it really that easy?
It’s worth mentioning that developer exit cases can be complex. These loans are usually high value at very short notice, involving large portfolios where all assets need to be valued and surveyed.
They’re complex, need quick turnarounds and are bespoke to each client.
This means lenders need the capacity and skillset to meet this demand and provide the relevant support for the client.
In the growing market of specialist finance products, there needs to be more education for brokers on what details they need from their client to present the best case with the lender to ensure the most positive outcome.
And, what’s more, brokers need to be aware of the lenders that can guide and support them through the process – because, in all honesty, not all of them can.
How could InterBay Commercial help?
The developer exit product we offer at InterBay Commercial provides an alternative to a typically more expensive option of extending existing development finance. It can also include an interest roll up facility, giving the client time to sell the property without impacting upon cash flow.
We can offer new outcomes for clients, delivering alternative exit strategies when the mainstream options don’t work for the client’s situation.
Find out more about our developer exit product today, or call the expert team at Brightstar on 01277 508 951 to get your questions answered.
See how we could support your clients’ short-term financing.