Small and medium-sized home builders can sometimes struggle to obtain the finance needed for their projects. A government-backed scheme, however, addresses this issue and offers help in the form of development finance. Launched by Homes England, the Levelling Up Home Building Fund provides loans that start from £250,000.
The need for the Levelling Up Home Building Fund
More housing is desperately needed across England but the housing market also needs to be more diverse and resilient. Innovation is being encouraged in the types of homes that are built as well as how they are delivered. A focus on creating thriving communities is also important. Small and medium-sized home builders can offer these solutions, as can innovative developers. However, they currently encounter various issues in an industry that’s dominated by larger companies. One of these obstacles is being unable to obtain the project financing needed from traditional lenders.
What is the Levelling Up Home Building Fund?
The Levelling Up Home Building Fund offers a solution to these issues. Development finance loans starting at £250,000 are offered to innovative developers and small and medium-sized home builders. The loan is usually taken out for a term of up to 5 years and interest is charged on it at a commercial rate. Security needs to be provided, which is usually in the form of property assets.
A loan provided by the Levelling Up Home Building Fund covers a project’s development costs. As a small or medium-sized enterprise (SME), this enables you to get your project underway, building more homes while also growing your business.
For help with infrastructure and enabling costs, an infrastructure loan is available via the Home Building Fund.
Are you eligible for a development finance loan?
To apply for a loan via the Levelling Up Home Building Fund, you need to be a UK-registered corporate entity or a limited liability partnership (LLP). The site, which you need to have majority control of for development, must be in England and your plan must be to build or refurbish a minimum of five homes. Your project must be financially viable and you need to at least have outline planning permission before a loan will be offered.
How to apply for a loan via this scheme
To make an initial enquiry, you can contact Homes England by email at fundingenquiries@homesengland.gov.uk or via their online form. Alternatively, you can contact them by telephone or post.
Is the Levelling Up Home Building Fund right for you?
If you’re not sure whether the Levelling Up Home Building Fund is right for you or not, just give our mortgage brokers a call on 01322 907 000. They can discuss your project plans in detail along with your financial situation to determine the best course of action to take. We offer various financing solutions and will ascertain the one best suited to your circumstances and project requirements.
As independent mortgage brokers in Kent, London and Edinburgh, we provide you with impartial advice. This ensures that you can make an informed decision before proceeding with a financial product.