Construction finance guide

Need construction finance for your next property development project? Crowd Property Capital can help.

CPC are construction finance experts, and have helped both small-scale developers and professional developers secure building loans for projects throughout Australia.

Property development finance is a highly specialised field. It’s very hard to secure favourable finance terms if you do it yourself. That’s why it makes sense to partner with an expert construction finance broker, like CPC, who can compare the market and negotiate with construction loan lenders on your behalf.

What value does CPC add to construction funding?

Crowd Property Capital get projects funded.

That’s the value we provide.

There are four reasons CPC are so good at helping developers get construction finance:

Diversity – we work with a diverse range of banks, non-bank lenders, high-net-worth individuals, family offices, SMSFs and managed funds, so we can match you with a funder that is keen to back developers just like you and projects just like yours
Flexibility – we take the time to understand your unique situation, so we can create an effective finance solution tailored specifically for you and place you with a lender that welcomes that kind of business
Experience – we know how to present applications in a way that suits each lender’s individual requirements, which maximises our clients’ chance of approval
Reputation – lenders respond very favourably to CPC applications, because we have a track record of thoroughly researching all our projects and presenting them in a way that’s easy for lenders to understand

There’s one other crucial value-add CPC provide developers.

As part of getting to know our clients’ situation, we respectfully challenge and stress-test the assumptions behind their project. That helps our clients uncover potential problems in advance.

Why choose a non-bank construction finance option

Banks can be good finance partners. But they can also be very inflexible. That’s one reason CPC has relationships with a diverse range of reputable non-bank lenders and alternative finance providers.

Another reason is because there are many viable projects that banks don’t want to finance. Why? Because they’re inflexible.

But even if you could find a bank willing to finance your property development project, there’s a good chance you could find a non-bank lender willing to finance it on even better terms. That may include:

Approving loans more quickly
Offering looser borrowing terms
Allowing you to proceed with lower levels of pre-sales

There’s one other reason why it can be good to use a non-bank lender. If you already have a loan with a particular bank, and then take out another loan with the same institution, you’re giving that bank enormous control over you.

Need construction finance?

It’s not impossible to organise your own property development finance – but it is risky. If you choose the wrong lender or agree to the wrong borrowing terms, there could be serious financial consequences down the line.

For peace of mind, and to make sure you get a construction loan package that suits your unique circumstances, it’s a good idea to get help from an expert construction finance broker.

To discuss your construction finance options, book a free strategy session with David Lovato.

Phone: 0434 932 634
Email: [email protected]

Get Finance

“CPC is a professional outfit, Dave displays all the top characteristics of a quality finance broker. Highly effective communication and prompt provision of requested information greatly assists in the loan assessment process benefiting both the client and the lender. His end to end knowledge of the loan application and settlement process is invaluable when navigating through sometimes complex and time sensitive scenarios”

Greg Turner - Trilogy Funds ManagementLender Testimonial

“CPC’s grounding in development management sets them apart from other finance brokers in the construction lending space. Initial assessment of project risks and deep understanding of their developer clients needs allows Solido to quickly assess his deals. Dave stays involved in the projects after initial settlement which is invaluable in assisting both developer and lender on the way through and at loan exit.”

Beau Quarry - Solido Capital Lender Testimonial

“David is highly responsive, always professional, kind and patient. We were impressed with the detail and updates provided by David throughout the lending process. David has shown a high degree of understanding in the structuring and brainstorming of an optimal funding solution, finding a suitable solution for both the capital provider, and the client”

Lender TestimonialSouth Yarra VIC

Frequently asked questions

How does construction finance work?

Construction finance is there to help a developer pay for their construction costs. Because the developer will pay for these costs as the build progresses, the loan will be progressively drawn down in instalments usually on a monthly basis.

This method helps the developer because they only need to pay interest on the amounts already received, and helps the lender because it reduces their risk.

What does finance mean in construction?

Finance in construction means a building loan.

Construction finance also means flexibility, because it gives the developer the flexibility to develop a project when the cost of constructing that development exceeds their own funding. It also helps with their cash flow, because they can spend their money on marketing the development, rather than paying the building costs.

What are the benefits of construction financing?

The benefits of construction financing are that developers receive the funds they need to build profitable projects.

With most construction financing, developers pay interest only on the funds they’ve already received, not the entire capital amount, which minimises their costs.

Construction financing also helps developers’ cash flow because they don’t need to repay the loan until the construction is complete.

How do you finance a construction project?

The first step in financing a construction project is to finalise what the project will consist of – a new build or a renovation.

The next step is to get the right people on board, like builders, project managers and architects.

Finally you should consider contacting a finance broker to help you draw up the paperwork, structure the loan and apply to lenders for finance.

How do builders finance their projects?

Builders finance their projects by taking out a construction loan for the duration of the build.

Once the construction is complete, builders can take out a standard mortgage loan if they still need finance.

A finance broker can help builders obtain both these types of loans.

Legal & Compliance

Crowd Property Capital Pty Ltd (CPC)

A registered company under the Corporations Act 2001, ACN 600 539 544

An accredited member of the Finance Brokers Association of Australia (FBAA) Member No M-352808

A licensed Corporation under the Property, Stock and Business Act 2002, Corporation License No. 10065109.

A member of the Real Estate Institute of NSW (REINSW)

David Lovato (Sole Director) holds a Certificate IV in Finance and Mortgage Broking and Property Services (Real Estate Agents License No 201 604 57 )