Finance Cost
Estimate total development finance cost including drawdown profile and fees.
Introduction
Who this is for: Developers budgeting finance on a construction scheme.
Why it matters: Development finance is drawn progressively, so interest is not charged on the full facility from day one. Assuming it is overstates cost significantly; assuming no finance cost at all understates it fatally.
Typical scenario: An 18-month build with a 6-month sales period, land drawn at day one and build drawn progressively.
- Charging interest on the full facility for the whole term rather than on average drawn balance.
- Forgetting arrangement and exit fees, which together often add 2-3% of facility.
- Omitting the sales period, during which interest continues to accrue.
Inputs
Facility
Programme
months
months
Fees
Analysis
Over 24 months at 9%, total finance cost is £453,000 — £378,000 interest plus £75,000 in fees. Build interest assumes progressive drawdown, averaging half the facility during construction.
This analysis provides context, not financial advice. Consult a qualified adviser before making investment decisions.
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Live Results
Total Finance Cost
£453,000
Total Interest
£378,000
Total Fees
£75,000
Cost as % of Facility
15.10%