Private Funders / Banks

[ScottNicol]

Anyone aware of any ?? ie Dunbar bank, United Trust bank.

Its going to be for residentail development finance

Cheers

[rich25]

How much do you need to borrow, what is the spec of the development? Whereabouts is it, are there any commercial elements at all?

[brendonj]

Rich,

POssible OT question but it may also help Scott. For a residential devlopment, say purchase bewteen £500k-£1m what finacing could a person get? ie 80% of purchase price and 80% of do-up costs (of £100k)?

Also how difficult would it be to get finance of this type if you didnt have a job but could show a history of residental development?

Many thanks.

[ScottNicol]

Rich, im in scotland, east ayrshire to be precise.

16 new build apartments, total outgoing of around 1.3m total income of 1.83m, looking for 100% on the build costs which i can get and looking for 80% on the land purchase price, i can get 70% at the moment but im after something a little higher than the 70% due to other commitments and i forgot to add there is no commercial elements involved

Edited by ScottNicol on Tuesday 7th November 13:17

[FUBAR]

brendonj said:

Rich,

POssible OT question but it may also help Scott. For a residential devlopment, say purchase bewteen £500k-£1m what finacing could a person get? ie 80% of purchase price and 80% of do-up costs (of £100k)?

Also how difficult would it be to get finance of this type if you didnt have a job but could show a history of residental development?

Many thanks.

Doh! I had a flyer land on my desk last week for a company offereing 'up to' 100% of both purchase price and build/fitout for resi developments. I'll see if it hasnt been thrown out yet.

[ScottNicol]

there atre lots of 100% funders, they either want a 50/50 profit share or charge 1.5% per month interest of the total loan !!

Edited by ScottNicol on Wednesday 8th November 11:11

[ScottNicol]

do you have any info that might help me Rich ?

[johnfm]

Hi Scott

My latest developments have been 100% funded by Yorkshire bank. Cost me just under 1% in admin fees, 1.5% over base interest and they want 7.5% of profit upon sale. Considering the two schems
es may make circa £250k, total fees in the region of £35k are acceptable to me.

I see money a bit like bricks, concrete, tiles etc - money is just another 'building material' that I have to pay for if I want to make money building houses.

More practically, the 100% funding means I don't need to spend 'personal' joint funds so wife is happier - which is always a bonus!!!

[ScottNicol]

John,

Thanks for the reply bud, the 100% funding is something i have looked at a few times, the ones i have looked at are 1.5% interest per month or 50/50 profit share. Did you have to haggle with the YB to agree a 7.5% profit share? did you have a relationship with them before hand ? it seems pretty reasonable considering its 100% funding, id be up for that sort of deal. Also wot is the interest rate you got on that deal ? Edit again lol this edit button is gd. Do you have a contact for the Yorkshire Bank i might just give them a call.

Scott

Edited by ScottNicol on Friday 10th November 10:14

Edited by ScottNicol on Friday 10th November 10:28

[johnfm]

ScottNicol said:

John,

Thanks for the reply bud, the 100% funding is something i have looked at a few times, the ones i have looked at are 1.5% interest per month or 50/50 profit share. Did you have to haggle with the YB to agree a 7.5% profit share? did you have a relationship with them before hand ? it seems pretty reasonable considering its 100% funding, id be up for that sort of deal. Also wot is the interest rate you got on that deal ? Edit again lol this edit button is gd. Do you have a contact for the Yorkshire Bank i might just give them a call.

Scott

Edited by ScottNicol on Friday 10th November 10:14

Edited by ScottNicol on Friday 10th November 10:28

Scott

My personal banking is with YB too. My property banking is with a local banker. We were introduced a few years back and they helped with financing a refurb on the house I lived in. My most recent house refurb, also my own, personal dwelling, was a £500k project (total cost) which we did really well - so the bank thinks I'm not an idiot.

If you have track record, you could do worse than YB - though Bank of Scotland here in Leeds were also very keen to have my business. Email me at [e-mail] if you wan ta name/number.

[ScottNicol]

John mnay thanks, looks as if i have been offerd a good deal here.

83% of opern market value (in this instance 1.8 million) which comes to just under 1.5 million which is enough to carry out my development. on a 100% basis really.

2.5% interest above base per month, 0.75% arrangement fee and 1% exit which we are trying to loose at the moment.

Pretty good deal, which i have someone trying to better at the moment.

If i need your contact John ill drop you a mail.

Are you on MSN at all ?

[johnfm]

good luck with the build!!
I just won my planning appeal today (written reps against planning decision)so I can now steam on with the £130k refurb I have benn planning for the last 6 months.

[ScottNicol]

John,

Thanks !!

Planning, wot a nightmare , i tend to buy things with planning in place as the planning process is a joke up here compared to where u are.

I do however buy bigger sites, 100-200 untis take them to planning and sell them onto bigger / national builders

[johnfm]

I fancy doing that, but finding sites in Leeds where you can do that is black magic!

[FUBAR]

How about a PH Property JV?

[cardigankid]

Is getting the Planning not where a big part of the profit is made? If the whole thing is set up why sell it on? Unless the profit from the actual development is not attractive compared to the risk and costs.

If you can tell me which part of the country the Planners are not a major obstruction I will move there

Edited by cardigankid on Wednesday 15th November 20:21

[smirnoff]

70% land and 100% build is usual as they only want a maximum of 75% exposure once the property is built. They also want to see an exit stratergy, so a % of off plan sales and nearly all sold pre completion.

Have you tried a broker, I am one, but a Scottish one may be better considering I am not sure how Scottish law affects off plan sales on new builds.

Adrian

[mikeg996]

ScottNicol said:

2.5% interest above base per month, 0.75% arrangement fee and 1% exit which we are trying to loose at the moment.

base+2.5% interest per MONTH? Or per annum?

[ScottNicol]

ive noticed i made a mistake there, its not per month, its per annum

Edited by ScottNicol on Friday 17th November 10:17

[mikeg996]

t'ank feck for that...£135k of interest over the year would put a bit downer on the profit margin.