Development finance

[morty]

Hi all!
Just wondering if anyone could recommend a good lender for a development project of 6 apartments in melb. I'm looking to borrow around the $2m mark (big step for me!!) including capitalising the interest into the loan. I've spoken to a few lenders westpac for example but was told i need to get commercial funding. Just thought someone might know of a lender who specializes in this area?

Any advice would be great.
cheers

Morty

 

[JoannaK]

it will be commercial funding. most banks have a commercial lending department that deal with this stuff on a daily basis.

there are plenty of lenders that do this type of lending. if you haven't done it before it would probably be a good idea to speak to a broker that specialises in this sort of finance as not all brokers are proficient in this area.

 

[Qlds007]

The amount of money you are seeking is not a big amount in terms of development finance so subject to everything funding the deal is not difficult.

Experience is something many development lenders look at so with limited experience the rate will be slightly higher (according to the risk margin) or the LVR will be lower.

Subject to your asset base nothing is impossible.

As Joanne mentioned many Brokers do not deal in this type of financing so you will need to approach somewith commercial experience.

 

[APerry]

Hi Morty,

If you want to post some more details on your project I'd be more than happy to give you some feedback. The lender that is most suitable will depend on a range of factors, most specifically the percentage of costs that you want to borrow and the number of presales (if any) you are happy to obtain.

Regards
Alistair

 

[rossdc]

Hi Morty Can I suggest you get some definite ideas and plans together if you have not done this type of devlopment before. We are in the stages of applying for finance through ANZ as the main criteria I look for is if the manager is familar with development and will not waste your time.
We are with another bank and because I cant keep my fantastic personal home finance manager I was referred for the fourth time to a businees manager who I saw last week and said yes I will send you an email today to confirm meeting and did not get back to me. I had to follow up

Gather all your plans and costing and similar devlopments and then prepare all your own personal data with all loans rent etc income in other words how you stand financially. Phone to make an appointment then a week prior to appointment fax/scan all document and send to business manager then follow up with phone call prior to meeting to check if recieved. This show you are organized and mean business. How the manager responds is a good feel for you how you will be received BUT MAKE SURE YOU CAN SHOW YOU CAN AFFORD PROJECT and make sure you are aware if you are going to hold or sell some of the townhouses at the end as this also will affect your approval for finance. If you dont want a bank there are some excellent mortgage brokers on this chat site.
All the best