What Is The Home Building Fund?
The Government is keen to have more homes built in the UK both for owner occupation and renting out. However, a stumbling block can be the availability of development finance to builders both large and small. This is one of the reasons why the Home Building Fund was set up by the Government here in the UK with it being looked after by the Homes and Communities Agency.
The fund makes available development finance and infrastructure finance. Normally loans of between £250,000 to £250 million are available although requests for smaller amounts would be considered. The interest rate is variable with security being required that is normally deed security and the term can be for up to 5 years for development finance and up to 20 years for infrastructure finance.
Loans are available for building new homes and for providing sites that are then ready to build on. One of the requirements to be considered for such borrowing is that a business must be able to show that it is either not able to carry out the scheme without suitable funding or that it will take longer to develop the scheme than expected. At least 5 residential properties must be constructed to be considered for such finance. It is also worth noting that the development project must be situated here in England.
There are, of course, many other sources of development finance such as through your bank although, should your bank not be supportive, there is nothing to stop you applying for development finance through other banks and building societies or specialist lenders including B2B lending package providers.
You really should consider shopping around to try to obtain the most competitive development finance package. Usually, a business looking for such finance should be able to either do their own research or, if time is at a premium, then he or she may wish to avail themselves of the outstanding service provided by another business. So, if you are looking for development finance, why not give us a call and we will put you in the hands of an experienced broker who specializes in arranging such borrowing.