Development finance and the fine print

Good morning, and Bob's breakfast

Bob's tip: sunblock early

Real finance questions from students

Q1: Interest capped but paid up front?

Retail finance first, then development

The retail broker who was out of his depth

Interest on what you draw, not day one

Why up-front interest costs more

One broker switch saved $200,000

Why banks avoid development lending

Specialists, not jacks of all trades

Q2: 65% LVR, but interest comes out?

LVR means something different here

Capitalised interest and the interest cap

Why serviceability rarely matters

North Harbour, now finished

Design extras that set it apart

What those extras cost per unit

Prices lifted because of the extras

Q3: Interest on the full loan day one?

Q4: Are these broker and lender fees normal?

What brokers and lenders usually charge

Line fees: drawn amount or full loan

Comparing 7% plus a line fee with 9%

Who pays the fees, and when

Term, extensions and other variables

Read the term sheet carefully

Lawyers can miss finance details too

Free masterclass on 21 November

Q5: $50,000 of fees already paid

Deals killed by the wrong finance

Lender structures to avoid

Wrap up, and Part 2 coming

Development finance has its own language and plenty of fine print. Bob Andersen and Hilary Saxton work through real finance questions from mentoring students, names removed, so you know what to ask before you sign.

Bob explains why construction interest should be charged on what you have drawn and not on the whole loan from day one, what LVR really means in development, how capitalised interest and the interest cap work, what brokers and lenders typically charge in application, line and brokerage fees, why you should read the term sheet and its conditions precedent, and why a property lawyer can still miss finance details. Along the way, a look at the finished North Harbour industrial units and what the design extras cost.

The takeaway: in development finance, the headline rate is only one moving part. One broker switch saved a student around $200,000. A short follow-up on more finance questions is coming in a couple of weeks.

Free Profit with Property Development Masterclass, Saturday 21 November 2026, 9am to 1pm AEDT, live on Zoom: https://www.propertymastermind.com.au/events/profit-with-property-development-masterclass/

Hosted by Bob Andersen and Hilary Saxton of Property Mastermind.

Want to sky-rocket your property development career? Bob Andersen & Hilary Saxton are here to add value to your property journey, whether it be through high-quality education, guidance, and accountability. Stay tuned for weekly episodes!

<p>Want to sky-rocket your property development career? Bob Andersen &amp; Hilary Saxton are here to add value to your property journey, whether it be through high-quality education, guidance, and accountability. Stay tuned for weekly episodes!</p>

Property Mastermind - All Things Property Development

Property Mastermind Podcast with Bob Andersen & Hilary Saxton

The Finance Fine Print That Nearly Cost $200,000 | EP 279