InterBay Commercial, part of specialist lending group OneSavings Bank plc, has launched a developer exit product with a rate from 0.7% per month up to 75% loan-to-value on loans between £100,000 and £5m, writes Sarah Davidson.
The deal is available with a six or 12 month term, interest roll up for the full term and the arrangement fee can be added to the loan.
The product is designed to enable developers to refinance recently completed small to medium sized (single or multi-unit) residential developments while in the process of selling the properties.
Colin Bell, product and new business director at InterBay and Kent Reliance, said: “Our key partners have highlighted the need for greater security in the building and construction industry, so I’m happy we’re able to provide yet further reassurances to developers that they can raise funds from current or recent properties to help them move on to the next opportunity.
“If recent times have taught us anything, it’s that cash flow is the primary pressure for developers. That’s why we’re developing these specific lending products that give developers the confidence to keep building, keep contributing to the UK’s economic recovery, and keep helping to tackle this country’s chronic housing shortage.”
Brian Walters, director at New Source commercial Finance, said: “Cash flow is absolutely key to our developer clients who want to avoid having equity locked up in a completed development, waiting for sales and loan repayments before having access to cash again.
“This product allows cash to be released immediately, while rolling up both the arrangement fee and up to 12 months interest into the facility, eliminating the need to service the debt until anticipated property sales have taken place.”
Julian Ingall, director of Coreco Specialist Finance, added: “InterBay’s Developer Exit offering is an exciting new entrant to the market, easing a number of the financial restrictions that blight those in the developer community. It’s refreshing to see lenders listen so carefully to their stakeholders during the product development process, and I’m sure the approach will now lead to a flurry of activity for them.”