Unsure as to what sort of fees you should expect if you are applying for development finance? No problem at all. In this guide, we take you through everything you need to know about the other potential costs you could incur so that you can make an informed decision.
When getting a development finance loan, it is usually the case that the chosen lender will charge you the customer an arrangement fee. This refers to organising the loan itself and covers the cost of the work done by solicitors as well as their administration. The exact cost of this will be clearly declared upfront.
You will also need to take into consideration the cost of valuation fees when taking out this kind of loan. A surveyor you use, (or otherwise allocated to you by the lender) will cost you anywhere between £1,500 +VAT and £3,000 +VAT for an initial site inspection.
Another fee you will need to remember to think about is stamp duty. Stamp Duty Land Tax is a lump-sum tax that is charged on all property and land that is bought across the UK. The exact amount you will pay for this will depend on certain variables, such as the purchase price of the building, and whether it will be used for residential or non-residential use.
Of course, when taking out a property development finance loan, you also need to factor in the costs of construction costs for carrying out your project to completion. Always make sure you have made a plan before carrying out constructing work and make a budget that you are comfortable that you will be able to stick to.