Builder Funding

Construction finance for builders and developers

Builder funding is finance for real estate developers to acquire land, obtain approvals and construct residential or commercial projects. Construction finance is usually released in stages as the project progresses. Lenders monitor it closely and often route sales receipts through an escrow account. Repayment is expected from project sales or lease income.

Early Grow helps developers prepare a funding proposal and approach suitable banks, NBFCs and other funding partners. Related: real estate project funding and RERA consultancy.

Types of developer finance

• Construction finance – a term loan for building the approved project, released in stages linked to progress.
• Land or approval-stage funding – available from fewer lenders, at a higher cost and subject to regulatory limits.
• Lease rental discounting – for completed, leased commercial assets.
• Inventory or last-mile funding – to complete projects that are nearly finished, subject to lender appetite.

What lenders assess

• The developer’s track record of delivering projects.
• Project approvals and RERA registration where applicable.
• Land title and legal due diligence.
• Project cost, the means of finance and the promoter’s contribution.
• Sales so far, and cash-flow projections.
• Existing group debt, and security and guarantees.

Documents usually required

• Company or firm constitution documents, and KYC of the promoters.
• Audited financials and ITRs of the developer entity and group.
• Title documents, approvals, sanctioned plans and RERA registration.
• The project report with cost, schedule, sales plan and cash flows.
• Details of past and ongoing projects.

How Early Grow helps

1. We review the project, its approvals and funding needs.
2. We help prepare the project report, the cash-flow model and the funding proposal.
3. We identify funding partners suited to the project’s stage, size and location.
4. We coordinate due diligence and lender queries until the lender decides.