FAQs - ASAP Finance Ltd

Frequently Asked Questions

What is property development finance?

Property development finance is a short-term loan for residential, commercial and industrial development projects. It can involve financing the purchase of the land and progress (staged) payments for covering associated costs to complete the development.

What types of loans are available?

ASAP Finance offers a range of different loans including; investor loans, development loans, and bridging loans - so long as they are secured by property on a first mortgage basis, ASAP Finance can provide a funding solution for you.

Does ASAP Finance offer Second Mortgages?

ASAP Finance does not offer second mortgage finance unless it is being used to support an existing first mortgage held by ASAP. However, we are extremely flexible when it comes to loan structuring.

Can I get a construction loan from ASAP Finance?

Yes. Development finance is a core business for ASAP Finance and includes financing for land subdivisions and construction. This includes commercial, industrial and residential developments.

Will ASAP Finance fund commercial projects?

Yes. In addition to residential projects such as terraced townhouses and apartment complexes, ASAP Finance actively funds a wide variety of commercial and industrial projects. This includes the financing of retail shops, offices, industrial warehouses, showrooms, live-work units and much more. ASAP has also funded a wide variety of specialised commercial assets such as vineyards, orchards, motels, hotels, medical centres and childcare centres.

What information is required to apply for a development loan?

Documents most commonly required by ASAP Finance are (i) a sale and purchase agreement and (ii) draft building plans. Often this is all we need to issue indicative terms. Other supporting information can include approved Resource and Building Consents.

Does ASAP offer refinancing?

Yes. ASAP will refinance everything from standard investor loans to complex development loans, even if they are mid-way through completion. ASAP Finance often refinances development loans from other companies who do not possess the necessary skills or expertise to fund the project to completion.

Does ASAP Finance provide portfolio refinancing loans?

Yes. ASAP Finance offers finance for multiple properties for a single client.

What is a bridging loan?

A bridging loan is usually short-term finance for when you have purchased a new property but are yet to sell your existing property. The bridging loan helps you close the gap until you can access the equity through sale of your existing assets.

How do you structure your loans?
  • Interest only – pay only the interest on your loan, making regular payments on a monthly basis.
  • Part interest only – pay only part of the interest each month. The balance of the interest is paid at the end of the term of the loan.
  • Principal and interest – regular payments of both interest and principal on a monthly basis.
  • Capitalised interest – interest is added to the loan balance each month and all interest and principal is paid in full at the end of the loan. This is common for development loans
Under what circumstances can I get interest only finance?

ASAP Finance provides interest-only loans under almost all instances subject to the client's ability to service the debt. However, this does not include construction and development loans where our preference is to capitalise interest – this is because it forms part of the cost-to-complete facility. There are some exceptions to this - ASAP Finance may allow part-interest payments for experienced developers who are supported by strong cashflow.

Do I require property development documentation such as fixed price construction contracts, valuations and full financial disclosure?

No. ASAP Finance is not a typical New Zealand development finance company that requires you to 'tick all the boxes'. Each project is assessed on its business merits and ASAP Finance can often waive many of these conditions imposed by other lenders.

Does ASAP Finance offer long-term fixed-interest commercial mortgages or home loans?

ASAP Finance does not engage in long-term fixed interest lending like mainstream banks, instead emphasis is placed on commercial, residential and development loans (including construction) with a set exit plan that will enable the borrower to refinance to a mainstream bank within 12 months of financing through ASAP Finance. In certain circumstances where projects take more than 12 months, ASAP Finance can provide loan extensions.

How much can I borrow?

The amount you can borrow depends on your security, earnings, and the value of the asset. ASAP lends up to 75% of the value, depending on location and security.

ASAP Finance's minimum loan is $200,000 and we can lend up to $30 million on a single loan.

Can I repay my loan early?

Yes. You can repay your loan early – in part or in full. As long as you give us 30 days’ notice before you make a payment, you won’t need to make an early repayment fee.

What fees do I have to pay?

Although ASAP Finance charges an application fee of 2% (plus brokerage if applicable), this is usually added to the loan, so you don’t have to pay anything upfront. ASAP Finance is proud of not charging “hidden” fees such as minimum lending fees, early repayment fees and loan administration fees etc.

What are your interest rates?

ASAP Finance interest rates are sensitive to the level of risk and the term of the loan. Typically, the lowest interest rates are available for shorter terms (3-6 months). If your loan is considered higher risk, a margin may be applied to a base rate to reflect the level of risk the loan represents.

How long can I borrow for?

Loan terms range from a minimum of 3 months, to 12 months. In some instances, where a 12-month term is not sufficient to complete a project, ASAP Finance will consider extending the term of the loan to enable the project to be taken to completion.

Are you open to joint ventures?

Yes, ASAP Finance will consider joint ventures. In addition to assessing the viability of a project, ASAP Finance will enter joint ventures where there is a track record of being able to see a project through to completion. Preference is given to residential and commercial property projects.

What is first mortgage finance?

First mortgage finance is a loan secured against property, and which has priority over other liens or claims on a property.

What is second mortgage finance?

Second mortgage finance is a loan secured against equity in your home, where the money is used to fund other projects.

What is Equity?

The Anti Money Laundering and Countering Financing of Terrorism Act came into effect from 1 July 2013. This Act places an obligation on all New Zealand banks and financial institutions to detect and deter money laundering and terrorism financing. The goal is to help protect New Zealand from financial crime and improve our international reputation as a safe place for doing business.

How will the AML/CFT affect you?

Under the AML/CFT, all banks and financial institutions will need to collect more information to verify a customer’s identity and source of funds. Before ASAP Finance can give you a loan, we will need to ask you for these details. That means, even if you have borrowed from us before, we may need to ask you for extra identity documents and information.

Businesses, trusts, and other organisations will need to provide information on the organisation and anyone who acts on its behalf. The Act affects all banks and financial institutions in New Zealand, so we are required to abide by it. If you have any questions, please feel free to contact us by email or phone +64 9 520 3660.

Are there any other useful websites which I can refer to for information?
What is the Anti-Money Laundering and Countering Financing of Terrorism Act (AML/CFT)?

The Anti Money Laundering and Countering Financing of Terrorism Act came into effect from 1 July 2013. This Act places an obligation on all New Zealand banks and financial institutions to detect and deter money laundering and terrorism financing. The goal is to help protect New Zealand from financial crime and improve our international reputation as a safe place for doing business.

Is ASAP Finance a member of any industry body and dispute resolution service?

ASAP Finance has always developed and maintained strong relationships with various industry bodies. We are members of Financial Advice New Zealand which is the premier industry body representing the interests of financial advisors in New Zealand.

ASAP Finance is also a panel lender for some of the top mortgage aggregator groups including:

  • NZFSG / Loan Market
  • Mortgage Express
  • Kepa
  • Mike Pero Mortgages
  • Mortgage Link
  • Mortgage Supply Co
  • Newpark Group

ASAP Finance is also a member of the New Zealand Financial Services Complaints (FSCL) which provides an independent and impartial dispute resolution service. FSCL has been approved by the Minister of Consumer Affairs to operate as an external dispute resolution scheme in the financial services industry.

parallax background