Development Exit Finance
Development exit finance refinances a maturing development loan onto a cheaper, sales-period facility once the build is complete. It takes the pressure off an expiring development loan and gives you the time to sell units at full market value rather than at a discount.
What is development exit finance?
Development exit finance is a short-term refinancing facility secured against a completed development scheme. It replaces a maturing development loan, which was priced for the risk of a live build, with a cheaper, longer facility priced for the much lower risk of a finished, saleable building. The developer gains time to sell the remaining units at market value rather than cutting prices to hit a hard repayment deadline on the original development loan.
The logic is straightforward. A development loan prices build risk. Once the scheme is watertight and practically complete, that risk has gone, but the loan often still carries development-rate pricing. Development exit finance reprices for what you now actually have: a completed, valued asset. The rate is lower, the term is set to the sales period, and partial redemptions are made as each unit sells until the final sale clears the balance.
Development exit finance is unregulated and is arranged for developers and investors on completed investment schemes. We arrange it directly.
- Available once the development scheme is practically complete and units are saleable
- Replaces a maturing development loan at a lower rate reflecting completed-scheme risk
- Term set to the realistic sales period, not the original build timetable
- Partial redemptions: each unit sale reduces the outstanding balance
- May release developer equity if the completed scheme has revalued above development debt
- Lenders such as Shawbrook, LendInvest, Together and MT Finance are active in this product
Indicative terms
- Triggerscheme practically complete and units saleable
- Ratebelow development pricing; indicatively competitive with standard bridging rates (market, 2025)
- LTV against GDVtypically up to 70% of the completed GDV (indicative)
- Termset to the realistic sales period; commonly 12 to 18 months
- Redemption structurepartial redemptions as each unit sells
- Interestusually retained or rolled up; no monthly payments
Indicative only. Terms vary by lender, scheme and borrower and are not an offer of finance.
Who it suits
- Developers with a completed residential or mixed-use scheme still in the sales period
- Anyone whose development loan is approaching term expiry with units still to sell
- Developers who want to release trapped equity on a scheme that has revalued on completion
- Investors refinancing a completed buy-to-let or HMO development onto a sales-period facility ahead of a term mortgage
- Property professionals who want cheaper money than a development rate for the marketing and sales phase
Discuss development exit finance
A view on fundability within one working day.
How development exit finance works
Confirm practical completion
The scheme must be practically complete and the units marketable. We review the architect's or contractor's practical completion certificate, the current RICS valuation of the completed stock, the number of units reserved or exchanged, and the sales programme for the remainder. This is the package we take to the exit lender.
Appraise the exit facility
We structure the exit facility against the completed GDV and the outstanding development debt. The exit loan repays the development loan in full, and where the completed GDV is higher than the outstanding debt there may be headroom to release equity to the developer. We size the facility to the realistic sales period so the term is comfortable.
Lender introduction and terms
Development exit is a specialist niche placed with lenders who understand part-redemption structures and completed-scheme risk. We introduce the case, obtain indicative terms and present a comparison. Lenders such as Shawbrook, LendInvest, Together and MSP Capital are active here. The key term is the part-redemption mechanism: how much is released per unit sold and how quickly.
Valuation, legal and drawdown
The exit lender instructs a RICS valuation on the completed scheme. Legal work is shorter than on a development case because the build is done. Once the valuation is in and legals are complete, the exit facility draws down, repays the development loan and releases any equity element. From that point the loan amortises via unit sales.
Partial redemptions and final repayment
Each unit sale generates proceeds that partially redeem the exit facility, reducing the balance unit by unit over the sales period. The final unit sale repays the balance in full. Where one or two units do not sell, the fallback is to refinance those onto a buy-to-let or term mortgage and let them.
Who can access development exit finance?
Development exit finance is available to limited companies, SPVs and experienced individual developers on completed residential or mixed-use schemes. The scheme must be practically complete, with NHBC or other warranty in place and the building ready to occupy or already occupied. Lenders look at the remaining sales programme, the existing reservations and exchanges, and the realistic absorption rate for the remaining units. The existing development loan must be capable of full redemption from the exit facility. Adverse credit at the borrower level is considered on a case-by-case basis. First-time developers can access development exit finance where the scheme itself is straightforward and the sales evidence is strong.
How much can you borrow on a development exit?
Development exit lenders typically advance up to around 70% of the completed GDV across all remaining units. The loan must be sufficient to repay the outstanding development finance in full. Where the completed GDV is higher than the development debt, there is often headroom for a capital release. The LTV available varies by lender, scheme type and the proportion of units already reserved or exchanged. A scheme with strong sales evidence commands a higher LTV and a lower rate than one with no reservations in place.
What does development exit finance cost?
The defining feature of development exit finance is that it is cheaper than the development loan it replaces, because it prices completed-scheme risk rather than build risk. Indicative rates can be competitive with standard bridging rates; on prime, fully let or well-reserved schemes they can be below the bridging market average of around 0.88% per month (Bridging Trends, 2025). Beyond interest, expect an arrangement fee, a RICS valuation of the completed scheme and legal fees. Monitoring surveyor costs are not normally needed because the build is complete. We set out the total cost and the net saving against your existing development rate in the initial terms.
Development exit finance versus extending your development loan
Extending a maturing development loan is possible but usually expensive: the development lender charges default or extension rates, applies a further arrangement fee and continues to price for build risk even though the build is done. Development exit finance replaces that with a facility priced for completed-scheme risk, typically at a materially lower rate and with a term set to the genuine sales period. The saving in interest rate, compounded over the remaining sales months, usually outweighs the cost of setting up the exit facility. We model both options and present the comparison so you can make the decision on the numbers.
Development Exit Finance: common questions
What is development exit finance?
A facility that refinances a maturing development loan onto cheaper, longer money once the build is complete. It prices the lower risk of a finished, saleable scheme rather than a live construction project, and allows each unit sale to partially reduce the balance until the last sale clears the loan.
When should I use development exit finance?
When your development loan is approaching term expiry or is already in extension and you have units still to sell. If the build is complete and you are being charged development-rate pricing, a development exit facility almost always saves money over extending the original loan.
Can I release equity with development exit finance?
Often yes, if the completed GDV is higher than the outstanding development debt. The exit facility can be sized to repay the development loan and release the surplus equity to you, subject to the exit lender's LTV limit on the completed scheme.
How is the loan repaid?
Each unit sale partially redeems the exit facility. The lender sets a per-unit release price, and when each unit completes its sale that release price is applied to reduce the outstanding balance. The final unit sale repays the remaining balance in full.
How quickly can development exit finance complete?
Faster than original development finance, because there is no build to assess. A RICS valuation of the completed scheme and the legal work to replace the existing charge can typically be turned around in two to four weeks on a straightforward scheme.
Is development exit finance regulated?
No. Development exit finance is unregulated lending arranged for developers and investors on investment or commercial property. We arrange it directly without referral to an FCA-authorised firm.
Discuss development exit finance
Send us your scheme and we will come back with a view on fundability and likely terms within one working day.