From building one or two homes on a small plot, to a fully-fledged residential development, it’s important that you have the right finance in place, or your project can ground to a halt.
Acquiring land and derelict buildings for residential development is a key trend in the UK housing market. Demand for housing coupled with a lack of available land means that developers need to be creative with their plans in order to provide well-built housing that fits in with the local community.
If you are new to this type of development, or you are planning an unusual or large project, one of your first considerations is how to finance it. You could get a regular loan or mortgage, but these are often not available for development purposes and lenders may not be happy to loan as much money as you require. If you have been developing property previously, you may have money in the bank, but this is not usually enough to buy the land or property and then to develop it.
There are specialist finance agencies who are experts in providing finance for developments. These companies have experience in assessing the development potential of a site and in forecasting returns from it, which means they are happy to lend development capital. Some of the benefits of using this type of finance include:
- Flexibility – a specialist will be able to lend you the money for a term that suits you; from as little as a month to help with bridging loans, to the whole period of your development.
- Expertise – a good development finance company will understand your plans and ask about your expected returns and your timescale. Their attention to detail can help you to refine your plans.
- Bespoke finance – Talk to one of these specialist companies about your plans for the development. Your loan and any repayments can often be tailored to the scale and length of your project, rather than imposing harsh conditions and time periods.
It makes sense to use a specialist finance company if you’re planning any sort of development. Not only can you easily raise the money you need, but the loan can be tailored to your particular project and you can benefit from the company’s expertise and advice.
The debt negotiation process is a strategic and a timely matter. There are many contributing factors to consider, in order of ACHIEVING successful negotiations. First off, you must verify the delinquency status. A creditor is more likely to engage in negotiations according to the age of the account, in an attempt to avoid a net loss. (A debt is written off around 180 days to 220 days) During that time period, you can achieve a significantly lower settlement offer. Once the debt has been written off, it is no longer an active asset. At that point, the original value of the debt has depreciated, and the creditor must recovery net gain in order gain profit and maintain a financial relationship with investors. In order to obtain a net gain, the creditor must either employ a collection agency at a fraction of the cost, or sell the debt to debt buyer. Secondly, if the debt has to be negotiated with a collection agency or debt buyer, the third-party collectors are directly regulated by the Fair Debt Collection Practices Act administered by the Federal Trade Commission.