The two Stretch Senior products are now available at a maximum loan to cost of 85% (excluding stamp duty and interest), an increase from the previous limit of 80% LTC. The maximum LTGDV (Loan to Gross Development Value), meanwhile, is 70% including interest.
Both products have a 2% arrangement fee and an exit fee of 2% (charged against the facility). Interest is charged at 11%pa (added to the loan) and the minimum term is just one month (the maximum term, 36 months). The maximum loan size is £40m.
Mark Posniak, Head of Sales & Marketing, Dragonfly Property Finance, commented:
“The upgrade of our Stretch Senior products is all about giving developers increased flexibility and financial firepower. Since they require smaller capital contributions, these products materially boost cashflow and make developers a lot more agile. Stretch Senior loans also bring simplicity to projects, as brokers and their clients only have to deal with one lender, one set of legals and can avoid complex inter-creditor agreements altogether. There’s no need to scour around the market for the mezzanine tranche: it can all be done under the same roof. Essentially, Stretch Senior loans enable bigger projects to complete far more quickly and with infinitely less administration and fuss, which is what the professional developer is looking for. ”
