Development Finance Criteria

What lenders look for when funding a property project

Applying for development finance is not just about having a good idea. Lenders will assess a range of factors before they commit funds to your project. Understanding the key development finance criteria will help you prepare a stronger application and avoid delays or rejections.

We work with developers of all sizes to secure funding that fits their goals. Whether you are building from scratch or converting an existing asset, we help you meet lender expectations and structure your deal correctly from day one.

What are the criteria for development finance?

Planning permission:

You must have full planning permission or permitted development rights in place before funding can be released. Some lenders may consider pre-planning finance, but options are more limited.

The developer's experience:

While first-time developers are not excluded, lenders generally prefer applicants with relevant experience or a strong professional team in place. A clear track record of completed projects helps build confidence.

Project type and location:

Most development finance lenders will consider residential, commercial, or mixed-use schemes. Location is critical. Properties in high-demand areas or regions with strong comparables are more attractive to lenders.

Loan to value (LTV) and loan to cost (LTC):

Lenders will typically offer up to 65 to 70% of the land value and up to 100% of build costs, provided the total loan does not exceed 70 to 75% of the GDV (Gross Development Value). Lower leverage may help secure better terms.

Gross development value (GDV):

This is the projected end value of the completed site. Lenders will look closely at local comparables and market conditions to verify your GDV figure.

Build costs and timetable:

You will need to provide a detailed cost breakdown, including professional fees, contingency, and a realistic build schedule. Lenders want to see that the budget is accurate and achievable.

Exit strategy:

Your repayment plan is critical. Whether you plan to sell units or refinance onto a longer-term mortgage, your exit must be clear, viable, and achievable within the agreed term.

How Envelop Finance helps

We are not just here to tick boxes.

As a specialist development finance broker, we help you:

Understand the specific criteria for your type of project
Prepare and structure your application professionally
Identify any weak spots and recommend improvements
Match your deal with lenders who suit your profile
Navigate the full process from first enquiry to drawdown

Our goal is to help you meet and exceed the requirements lenders expect so you can get your project moving without unnecessary friction.

Additional considerations

Each lender has their own appetite for risk and target project profile, but most will assess the mentioned key areas when reviewing a development finance application.

Lenders may also review:

Your credit profile and financial standing
The strength and qualifications of your build team
Environmental or planning constraints on the site
Whether you are applying as an individual, partnership, or limited company

Meeting the basic development finance criteria is one thing. Presenting your project clearly and confidently is what turns approval into funding.

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If you are unsure whether your project fits current development finance criteria, speak to Envelop Finance today.

We will assess your plans, provide honest feedback, and guide you on how to meet lender expectations.

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0207 408 2305

Development Finance Criteria

What lenders look for when funding a property project

What are the criteria for development finance?

Planning permission:

The developer's experience:

Project type and location:

Loan to value (LTV) and loan to cost (LTC):

Gross development value (GDV):

Build costs and timetable:

Exit strategy:

How Envelop Finance helps

Additional considerations

Want to know more about development finance?

Criteria

FAQs

Calculator

Application

Speak to our development finance team

What we’ll need to get started

To source the right development finance, we’ll typically need:

Details of the site and planning consent

Build costs and schedule

GDV (Gross Development Value) estimate

Experience or CV of the development team

Exit strategy (sale or refinance)

Whether you're in the early planning stages or need urgent funding, we're here to make it happen.

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