10 Things Developers Should Consider Before Applying for Development Finance

Charles Creak

September 30, 2026

Property development can offer significant opportunities, but a successful project requires careful planning, realistic financial modelling and the right funding structure.

Development finance can help fund land acquisition and construction costs, allowing developers to progress schemes without providing all the capital upfront. However, lenders will consider much more than the amount being requested. The project’s costs, GDV, planning position, development team and exit strategy can all influence how an application is assessed.

Before applying for development finance, here are 10 important factors to consider.

1. Have You Accurately Calculated Your Total Development Costs?

Your funding requirement should reflect the true cost of completing the project, not just the purchase price and construction budget.

Consider professional fees, planning costs, legal costs, finance costs, site preparation and contingency alongside the main build costs.

Underestimating costs can create funding shortfalls later, so a detailed and realistic development appraisal is essential.

2. Is Your Gross Development Value (GDV) Realistic?

Gross Development Value (GDV) is the anticipated value of the completed development and is a key consideration when assessing development finance.

Your projected values should be supported by comparable properties, local market conditions, specification and a realistic sales strategy.

A well-supported GDV gives a lender greater confidence in the viability of the scheme and helps establish how much funding may be appropriate.

3. Do You Understand Your Loan-to-Cost and Loan-to-GDV Position?

Loan-to-Cost (LTC) measures the loan against the overall development cost, while Loan-to-GDV (LTGDV) considers the loan against the anticipated value of the completed project.

Understanding both can help you establish how much equity you’ll need to contribute and whether your proposed funding structure is realistic.

It also prevents you from basing your development appraisal on a level of borrowing that may not ultimately be available.

4. What Is Your Planning Position?

Planning can have a significant impact on the timing and viability of a development.

Before applying for finance, establish whether planning permission has been granted, whether there are outstanding conditions, or whether an application is still being considered.

KSEYE’s development finance enquiry process asks about the project’s planning position and development stage, helping the lending team understand where the scheme currently stands.

5. Have You Prepared a Realistic Construction Budget?

Your development appraisal is only as reliable as the cost assumptions behind it.

Obtain realistic build-cost estimates and consider the project’s size, specification and complexity. It’s also sensible to include contingency for unforeseen costs.

The aim isn’t to produce the lowest possible construction figure, but to demonstrate that the project can realistically be delivered within the proposed budget.

6. Is Your Development Team in Place?

The people delivering the project can be just as important as the financials.

Depending on the scheme, this may include an architect, contractor, quantity surveyor and other professional advisers.

KSEYE’s application process asks for details of key professionals, including the architect, builder and quantity surveyor. Having an experienced team in place can demonstrate that the project has been properly planned and is ready to progress.

7. Is Your Development Programme Realistic?

Your construction programme should reflect the practical realities of delivering the project.

Consider construction timescales, inspections, certification and completion, while allowing for potential delays such as planning issues, contractor availability or unforeseen works.

A realistic programme can help ensure that your finance remains appropriate throughout the development.

8. Do You Understand How the Finance Will Be Drawn Down?

Development finance is typically released progressively as construction works are completed rather than provided entirely upfront.

Understanding how drawdowns work and how they align with your construction programme is important for managing contractor payments and project cash flow.

Your lender should be able to explain how funding will be accessed throughout the development and what requirements need to be met at each stage.

9. What Is Your Exit Strategy?

Your lender will need to understand how the development finance will ultimately be repaid.

Common exits include selling the completed units or refinancing onto longer-term investment finance.

Your proposed exit should be supported by realistic values and market assumptions. It’s also worth considering what happens if the project or eventual sale takes longer than expected.

10. Does Your Finance Partner Understand Your Development?

Finally, consider whether your lender understands the type of development you’re proposing and is willing to assess the individual circumstances of the scheme.

A new-build residential development, commercial project, conversion or mixed-use scheme can each present very different considerations.

KSEYE takes a case-by-case approach to development finance, with lending criteria covering residential, commercial and mixed-use property, as well as small-scale development and loan sizes from £150,000 to £50 million.

This can be particularly valuable when a project doesn’t fit neatly into a standard lending profile.

Conclusion

A successful development starts with a realistic plan. Accurate costs, achievable GDV, appropriate planning, an experienced professional team and a clear exit strategy can all strengthen your finance application and help identify potential issues early.

At KSEYE, we take a tailored approach to development finance, assessing each project on its individual circumstances. Whether you’re funding a new-build, conversion, mixed-use scheme or another development project, our experienced team can work with you to understand the opportunity and structure a funding solution around it.

The better prepared the development, the clearer the funding requirement—and the more productive the conversation with your lender can be.