Alternative Bridging Corporation has overhauled its residential development finance proposition, creating a single simple product to finance schemes from construction through to the final sale.
The lender says that by focusing only on the essential and removing obstacles to completion, the new arrangements provide a combination of flexibility, cost effective pricing and certainty of delivery.
The enhanced proposition brings residential development finance and development exit funding into one integrated structure, removing the need for separate facilities while offering the benefit of a materially reduced interest rate following practical completion.
Under the new offering, Alternative Bridging now provides a single residential development finance product with interest priced from the Bank of England Base Rate (3.75%) plus 6.5%, with a maximum loan-to-gross-development-value (LTGDV) of 70%.
Construction funding is enhanced by a rolling construction float, which is deducted and repaid from each stage advance. This is designed to support cash-flow throughout the build period while maintaining clear funding visibility throughout the life of the project.
A central feature of the revamp is the automatic transition into a development exit loan following practical completion of the scheme. This is included within the original residential development finance terms, removing the need for a separate refinance application. Upon entry into the development exit phase, the interest rate reduces by 1.5% p.a. for the remainder of the term.
The structure also allows for an extended sales period, giving borrowers additional time to maximise sales proceeds without the pressure of a short exit deadline. Where further funding is required during the scheme, brokers can use the Alternative Overdraft secured against under utilised assets to top up the residential development finance facility.
At exit, borrowers also have the option to refinance onto an Alternative Term Loan for a period of two to five years, providing additional flexibility where a longer hold strategy is beneficial.
The revised proposition is aimed at experienced developers and construction professionals seeking a joined-up funding solution, particularly where timing, cash flow management and exit optionality are key considerations.
James Bloom, director at Alternative Bridging Corporation, said: “This is a fundamental change in how we structure development finance and it is one we are very excited to bring to the market. Rather than treating construction, exit and longer-term funding as separate conversations, we have combined them into a single facility that runs from commencement of construction through to the final sale. Pricing and terms are clearly stated and adjust to match the risk profile, giving brokers clarity and far more certainty of satisfying their clients’ requirements.
“For over 30 years we have been a very active principal funder to the residential development sector and this substantial revamp to include higher lending ratios, lower interest rates and seamless switching to lower rates and longer term facilities further builds on our long-standing support to this sector.
“It is a strong way to start 2026 and sets the direction of travel for new products and further enhancements that we will bring to the market early this year.”
