As highlighted during the recent AOBP roadshow, there are a number of borrowers searching to fund projects and developments outside of London. Such a proposal inevitably requires a different approach to that used when securing finance within the M25.

B&C spoke to Simon Ismail, Director at Goldentree Financial Services, who told us his top 10 tips for when considering financing projects outside of the capital…

Tip 1: When securing finance outside of the M25, it is essential that you can source a lender who understands and deals with applications with the same appetite and fairness as within London. This usually means using a lender that itself is based outside of the capital.

Tip 2: The lender you source needs to be prepared to potentially travel to, and investigate, the location of the property.

Tip 3: Ask your chosen lender if they have completed any deals in this location before and if they are comfortable with the local geography from the outset.

Tip 4: Does the lender have a range of local professional contacts that it, and you, can rely on when taking the deal through to completion? The last thing you want is a lender sending a London-based surveyor to a property in the Lake District just because they ‘trust his opinion’, regardless of his local knowledge.

Tip 5: Make sure you have done sufficient diligence on local market prices, information which is now easily accessible on the internet. This is the same process as you would use within the M25.

Tip 6: Make sure there are enough long-term lenders who operate in this locality. You need to be comfortable that a refinance is possible should this be the preferred exit route.

Tip 7: Provide a full financial appraisal of the deal with details of all costs involved in the transaction, including refurbishment/development costs.

Tip 8: Focus on the exit route and be honest in assessing the options: a lender will usually want to see Option A and Option B.

Tip 9: Be aware of pricing issues. A lender in the North West will probably want a slightly higher return than normal if they are going to do a deal in the far South West of England or North of Scotland.

Tip 10: Make sure you have commented on all the relevant planning issue in the locality. A lender will appreciate research on planning permissions include planning reference numbers and copy decision notices.