A survey carried out by United Trust Bank has found that speed of initial decision is the most important factor for brokers when choosing a development finance lender.
The survey asked brokers to list in order of importance their key factors when choosing a development finance lender. The results have been tabulated to create an overall ‘top five’ based on brokers’ five most popular selections in order of importance.
The most important development finance lender attributes are as follows:
1 – Speed of initial decision
2 – Interest rates and charges
3 – Speed of application process
4 – Knowledge and expertise of staff
5 – Flexibility
Noel Meredith (pictured), executive director at United Trust Bank, said: “There are several key factors brokers will consider when selecting which lenders to approach for development finance and no doubt each case will require a slightly different mix. Lender flexibility is important in development finance when perfect proposals are few and far between and builds don’t always go to plan. Brokers will also be looking for the best deal to suit their client’s budget so interest rates and charges will always be an important factor.
“Working with a team which can demonstrate experience, knowledge and the ability to advise beyond just aspects of the financing can also be of huge benefit to the broker and the developer, especially if the broker is fairly new to the development finance sector. However, according to brokers, on balance the most important consideration when choosing a development finance lender at the moment is how quickly they can get a decision, and there’s a good reason for that.
“When a developer approaches a broker to help secure funding they will want to proceed quickly. A developer may already be incurring project costs and every day of delay may be eating into their margin. A quick initial decision from the lender enables the broker to demonstrate to their client that the lender they recommend is able to move at the pace the developer requires. However it is important that this initial decision is the correct one. This is where our knowledge and expertise pays dividends. At UTB we aim to provide swift initial decisions and follow through with viable, flexible and attractive proposals, ensuring the broker and developer’s time is not wasted.
“Delays at this early stage might indicate to the developer that the lender will not be as responsive as they would like, especially if problems are encountered later on. This may in turn cause them to doubt their broker’s advice. As such, a quick initial decision from the lender will help the broker to cement their relationship with the developer from the outset.”
