No Doc Development Loans

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In the wake of the 2018 Royal Commission into Banking, many of the major players are tightening their lending criteria and obtaining Development Funding from Banks has become more difficult. As a result, second tier banks, private funders and joint venture funders are increasingly becoming a popular alternative for some developers.

No Doc Development Loans main advantage is generally they do not require pre-sales or financials and are typically far more flexible in their lending criteria.

General facilities are up to 65% GRV (gross realisation value) or to 80% of TDC (total development costs) – with no pre-sales options and stretched Senior Facilities to 75% of GRV & 90% of TDC with minimum 25% pre-sales & acceptable ROI.

Funding is also available for incomplete or partially complete projects and land subdivision.

Key Points:

  • Up to 90% of Total Development Costs (TDC)
  • Up to 75% of Gross Realisable Value (GRV)
  • Rates start from 8% plus establishment and set up fees
  • Loan Amounts from $1M to $250M
  • Well located projects only
  • Flexible pre-sale requirements (including overseas buyers)
  • Overseas developers accepted

Development Finance

In development finance, the borrower prepares information for lenders including a feasibility analysis showing land purchase costs, constructions costs, gross realisation value and the expected development margin before submitting to a funder for consideration.

Initial Documentation Required:

  • Overview of the project with key metrics summarised
  • Valuation Report and Quantity Surveyor Report if available
  • Copy of the contract of sale (if acquisition).
  • Details (lender and outstanding balance) of any mortgages currently on the property.
  • Feasibility study for the project.
  • Copy of the Development Approval and Building Approval (Construction Certificate)
  • Confirmation of Pre Sales contracts if available
  • Copy of  fixed Price Building Contract  or Confirmation of construction / development costs
  • Details of the proposed builder and a resume of their building experiences
  • Resume of the borrowers development / building experiences