Best finance options for property development?

[HotJambalaya]

Just wondering here, selling out of one flat, and will be looking at buying, refurbishing and selling others from now on. I'm just wondering what the best options are for this?

I've had a little look online, and they're a lot of lenders I've never heard of (apart from barclays!).

Just curious what people think/have experience of?

-and is there any way to see which finance companies have complaints etc against them?

Edited by HotJambalaya on Monday 26th October 17:06

[Pork]

I'd be interested to read responses to this.

I had a look earlier this year and was told that the absolute minimum I had to show was 5 years of developments, doing multiple developments per year. This was through a mate in the finance trade using his contacts, though granted, he's a much bigger fish then me.

Barclays told me they wanted ten years of experience!

The conclusion I drew from that is that banks aren't really interested in funding your learning curve.

[Mousem40]

Try getting BTL mortgages with zero early redemption fees (if you're buying to renovate then sell).
As long as you've been earning over £25k a year for the past 3 years and the rental valuation on the property stacks up that's all you'll need.

[CRB14]

I dare say you'd need cash - and plenty of it. And plenty of experience in this type of field.

If the property was in need of a full refurb I expect a traditional mortgage provider would be reluctant to loan too much against it if it was (or is to become) inhabitable.

[Pork]

Mousem40 said:

Try getting BTL mortgages with zero early redemption fees (if you're buying to renovate then sell).
As long as you've been earning over £25k a year for the past 3 years and the rental valuation on the property stacks up that's all you'll need.

I believe the above requires you to already own your own home and have it mortgaged.

[Mousem40]

Pork said:

Mousem40 said:

Try getting BTL mortgages with zero early redemption fees (if you're buying to renovate then sell).
As long as you've been earning over £25k a year for the past 3 years and the rental valuation on the property stacks up that's all you'll need.

I believe the above requires you to already own your own home and have it mortgaged.

Yes you're right. Re-reading the OP's post I guess that's not an option then.
Bridging loan 1% arrangement fee, 1% per month interest (standard rates which can be bettered).

[HotJambalaya]

Mousem40 said:

Pork said:

Mousem40 said:

Try getting BTL mortgages with zero early redemption fees (if you're buying to renovate then sell).
As long as you've been earning over £25k a year for the past 3 years and the rental valuation on the property stacks up that's all you'll need.

I believe the above requires you to already own your own home and have it mortgaged.

Yes you're right. Re-reading the OP's post I guess that's not an option then.
Bridging loan 1% arrangement fee, 1% per month interest (standard rates which can be bettered).

Well I already own my own home, with no mortgage.

I've just sold a BTL so will have a chunk to put in, but not enough to buy outright.

In the meantime my mortgage guy got back to me saying they offer bridging loans which are expensive 2% fee and 0.95% a month, maximum term time of 9 months. He said if the property is habitable a normal BTL should do.

So I think that really does seem to be the easiest. I have a fair bit of experience refurbishing, but none in specifically refurbishing to sell immediately.

[Sarnie]

HotJambalaya said:

Well I already own my own home, with no mortgage.

I've just sold a BTL so will have a chunk to put in, but not enough to buy outright.

In the meantime my mortgage guy got back to me saying they offer bridging loans which are expensive 2% fee and 0.95% a month, maximum term time of 9 months. He said if the property is habitable a normal BTL should do.

So I think that really does seem to be the easiest. I have a fair bit of experience refurbishing, but none in specifically refurbishing to sell immediately.

So why not remortgage your Residential property?

Would be the quickest, simplest and cheapest option.........

[trowelhead]

I was under the impression that lenders do not like developers taking out mortgages when they intend to flip in the short term, and you may get into trouble doing it repeatedly.

Bridging is expensive, but also what it is there for.

Or offset mortgage on your own home?