27th Feb 2020

Investment finance: What lenders want to know

An effective deal overview, is important to help generate a positive and swift response from lenders. It is an opportunity to provide lenders with the most important information as well as present the lending opportunity in a positive light.

Lenders often get a huge number of loan requests and by following the guidelines below you will be able reduce response times from lenders, requests for additional information and minimise terms variation between indicative offers to completion.

At a minimum we suggest the sections for an investment deal overview should include;

  • Outline of your facility request
  • Asset financials
  • Exit or refinance strategy
  • Borrower information
  • Asset information and business plan
  • Attachments


Your facility request

Here you can concisely outline the debt quantum of the facility you are looking for and provide a summary of the asset(s) it will be used to fund. Please add what repayment type you are looking for (interest only/ amortisation) and investment type (acquisition / refi / reposition).

Example Investment:

Opportunity to support Westgrey Capital with investment funding for an industrial asset in Slough, London with market value of £18m. The sponsor is looking for a funding amount of £10.8m, senior debt interest only facility for a 60 month term representing a LTV of 60%.

Asset financials

Lenders want to quickly understand the underlying financials surrounding the asset(s) at acquisition. They can then assess where on their risk curve the asset sits and it helps start to set the picture around your business plan later on in the overview section.

What to include:

  • Purchase price of the asset & or current market value
  • Net initial yield (NIY)
  • Vacant possession value

Exit or refinance strategy

This is where you will enable the lenders to understand how they will be repaid and help them better assess the risks involved through the term of the facility.

What to include Investment:

  • Do you plan to sell the investment or hold and refinance at the end of the term?
  • If it is a sale what is the expected exit yield and/or exit value?
  • What is the refinance strategy and expected leasing terms at end of term? (e.g. unexpired lease length, debt yield on exit)

Borrower information

Include a section about the borrower

This is your opportunity to communicate to lenders there is a suitable counterparty for them to lend to.

What to include:

  • Your experience in the sector,
  • Capabilities to deliver the business plan
  • Ability to support the deal financially in times of stress.
  • Borrowing structure
  • Details on equity partners

Previous similar projects or investments

What to include:

For investment deals please provide a list of investments held or previously held with a successful exit or refinance. Include metrics such as purchase price, term held, profit on disposal (if applicable), market value uplift (if applicable).

Asset information and business plan summary

Location and situation

What to include:

  • An overview of location
  • Around road links
  • Stations
  • Proximity to town centre,
  • Facilities,
  • Amenities
  • Schooling (applicable to Residential / BTL)

Asset status

What to include:

Description of the units, property, floor area and any capex requirements

Tenancy status

What to include:

Description of the tenants, number of leases, the average unexpired lease term and covenants

Business Plan

What to include:

Describe the business plan for the assets, how you are going to move income forward, what capex needs to be spent and how it will be funded, included re-letting assumption for cashflow, rent review discussions if applicable, lease re-gear strategy and any re-positioning of the building in the market


We have seen that lenders are able to provide a quick response and are more likely to respond with indicative offers when just a handful of required attachments are added to a deal. In general the feedback from lenders is that a minimum of a cash-flow and tenancy schedule detailing the forecast P&L and lease information for the asset and an investment memorandum (if available).

Investment deals should include a valuation (most recent) or some evidence explaining the current market value and or purchase price.

This will help you show the lender the credibility of the business plan above and the key assumptions used.

Files to include for Investment and Bridging:

  • Sales brochure
  • Investment memorandum
  • Corporate info on you as a borrower
  • Rental cash-flow
  • Tenancy schedule
  • Photographs

Found this guide useful? Check out our guide to applying for development finance here