Development exit finance is short-term property funding used when a development has reached, or is approaching, completion and the original development facility needs to be repaid or replaced.

A developer may have completed the construction successfully but still be waiting for:

individual units to sell;

a bulk sale to complete;

investment refinancing;

or another longer-term exit.

The original development loan may be approaching maturity.

Its pricing may also no longer reflect the reduced risk of a substantially completed scheme.

Rather than being forced to sell quickly or seek an extension from the existing development lender, the developer may refinance onto a dedicated development exit facility.

That can potentially:

repay the original development loan;

reduce financing pressure;

provide additional time for sales;

release equity from the completed scheme;

or create liquidity for the next development.

The important distinction is:

Development finance funds the construction. Development exit finance helps manage the period between completing the development and achieving the final exit.

What is development exit finance?

Development exit finance is a specialist short-term loan secured against a property development that is complete or sufficiently close to completion for an exit lender to consider it.

Current UK development lenders describe exit finance as a way of refinancing completed or near-completed schemes so that the original development debt can be repaid while the developer continues selling units or prepares another longer-term exit.

The facility may therefore sit between:

the construction phase

and

the final sale or refinance.

It is sometimes also referred to as:

development exit funding;

development exit bridging;

developer exit finance;

sales-period finance;

or post-development finance.

The terminology varies between lenders.

The core purpose is broadly the same.

When is development exit finance used?

It is most commonly considered when the development has reached a point where the original development facility is no longer the most appropriate form of borrowing.

For example, the developer may have:

reached practical completion;

completed the majority of the works;

received building control sign-off;

started selling units;

or created a finished investment asset ready for refinance.

The construction risk has substantially reduced.

The remaining challenge is now the exit.

That can involve:

selling;

refinancing;

retaining;

or a combination of these.

Why not simply keep the original development loan?

Sometimes that may be possible.

But development loans are generally structured around a defined construction programme and exit date.

Once that term approaches its end, the developer may face:

extension fees;

higher interest;

pressure from the existing lender;

reduced flexibility;

or a requirement to repay.

A development facility is also priced for the risks involved in constructing a property.

Once the development is substantially complete, a different lending product may potentially provide a more appropriate structure.

The question therefore becomes:

Does the developer still need development finance, or do they now primarily need time and liquidity to execute the exit?

Can development exit finance reduce the interest rate?

Potentially.

A completed development generally presents less construction risk than a site in the middle of a build.

Some exit facilities may therefore offer a lower financing cost than remaining on the original development loan or paying extension pricing.

Current market examples specifically describe development exit finance being used to reduce the developer’s cost of debt during the sales period.

But this is not guaranteed.

The economics depend on:

lender;

leverage;

property;

loan amount;

fees;

interest;

term;

and the existing facility being refinanced.

The complete cost should be compared.

Can development exit finance give you more time to sell?

Yes, potentially.

This is one of its main uses.

A developer may finish a scheme successfully but find that unit sales take longer than expected.

That can happen because of:

slower market conditions;

buyer chains;

mortgage delays;

seasonal demand;

higher interest rates;

pricing strategy;

or simply the time required to sell several units individually.

The development may be sound.

The original finance term may simply not provide enough time for the sales strategy to run its course.

Development exit finance can potentially create an additional marketing period.

Why does additional time matter?

Because a forced sale is not always the same as an appropriate sale.

Suppose a developer has completed 20 apartments.

The original development loan is approaching maturity.

Only 8 have sold.

The developer may have enough value in the completed scheme to repay the loan eventually.

But requiring immediate repayment could create pressure to:

reduce prices;

accept bulk-sale discounts;

or sell units faster than commercially desirable.

An exit facility may potentially provide more time.

That does not guarantee better prices.

It can simply reduce the need for financing deadlines to dictate the sales strategy.

Can development exit finance be used when units have already started selling?

Potentially.

A development does not need to be completely unsold.

Partially sold developments can also be refinanced.

Current lender case studies show exit finance being used where some units had already completed and the remaining units still needed to be sold.

The lender may want to understand:

how many units have sold;

agreed sale prices;

remaining stock;

current reservations;

marketing strategy;

and projected sales period.

Existing sales can also provide useful evidence of market demand.

Can development exit finance release equity?

Potentially.

Once construction is complete and the property has achieved its final value, there may be more equity in the scheme than was available during the development phase.

A refinance could potentially:

repay the existing development lender;

and release additional capital to the developer,

subject to the new lender’s maximum leverage and valuation.

That capital might then be used for:

the next site acquisition;

planning costs;

equity contribution to another development;

business working capital;

or another agreed purpose.

Current development exit propositions specifically include releasing capital for future projects as one potential use.

Can exit finance help fund the next development?

Potentially.

This can be commercially important for developers.

A significant amount of equity may be tied up in a completed scheme while sales continue.

At the same time, the developer may identify their next opportunity.

Without refinancing, they may have to wait until:

more units sell;

or the entire scheme exits.

A development exit facility may potentially release some of that capital sooner.

This can allow the developer to recycle equity.

But the new borrowing still needs to remain sustainable against the completed scheme.

Does releasing equity increase risk?

Potentially.

Refinancing above the amount required simply to repay the existing development loan increases the outstanding debt.

That means there is less equity buffer if:

property values fall;

sales take longer;

prices need to be reduced;

or unexpected costs arise.

The developer should therefore distinguish between:

equity that can technically be released

and

equity that is commercially sensible to release.

Maximum borrowing should not automatically become the objective.

Does a development have to be completely finished?

Not always.

Some lenders may consider schemes that are near completion or have limited residual works outstanding.

Current lender propositions include completed and near-completed developments, and there are recent examples of facilities completing before all works were finished where the lender was comfortable with the remaining programme and borrower.

However, the amount and nature of outstanding work can materially affect lender appetite.

What does “near complete” mean?

There is no universal definition.

The lender may consider:

percentage of works completed;

amount of money still required;

type of outstanding works;

practical completion timetable;

building control position;

warranties;

utilities;

landscaping;

snagging;

and marketability of the units.

A scheme requiring minor final works is very different from one that still carries substantial construction risk.

The lender needs to determine whether the case is genuinely an exit facility or still fundamentally a development loan.

Can exit finance fund outstanding works?

Potentially, with some lenders.

A developer may require a relatively modest amount to finish:

landscaping;

final fit-out;

snagging;

external works;

or another remaining element.

Some development exit lenders can potentially incorporate those costs into the facility.

Others may require full practical completion before refinancing.

The market therefore needs to be assessed according to the precise stage of the project.

What if the development has encountered delays?

This is a common reason exit finance is considered.

Delays can arise because of:

labour shortages;

materials;

utility connections;

planning conditions;

weather;

contractor issues;

or unforeseen construction problems.

The original development loan may have been structured around a programme that no longer reflects reality.

If the project is now substantially complete, refinancing may provide a cleaner solution than repeatedly extending the original facility.

Can exit finance be used before practical completion?

Potentially, depending on the lender and extent of remaining works.

Some lenders will consider pre-completion exit finance where they are satisfied that:

construction risk is limited;

costs to complete are clear;

sufficient value exists;

and the borrower has a credible exit.

Recent lender case studies demonstrate that pre-completion facilities can sometimes be structured, although this is more specialist than straightforward completed-development refinancing.

The project should not be assumed to qualify simply because it is close to the end.

Is development exit finance the same as bridging finance?

They can overlap, but they are not necessarily identical.

A development exit facility is designed specifically around the risks of a completed or near-completed development.

That can include:

multiple-unit sales;

partial releases;

residual development considerations;

sales periods;

and developer experience.

A general bridging loan is broader short-term finance that may be used for many different property purposes.

The most appropriate product depends on the scheme.

Could a bridging loan still be used?

Potentially.

A bridging lender may be comfortable refinancing a completed development.

This may be particularly relevant for:

smaller schemes;

single units;

straightforward properties;

or cases requiring speed.

But larger multi-unit developments may benefit from a lender with a dedicated development exit proposition.

The label is less important than whether the loan structure matches the asset and exit strategy.

What is the difference between development finance and development exit finance?

Development finance is generally used to fund:

site acquisition;

construction;

conversion;

refurbishment;

professional costs;

and other development expenditure.

The lender underwrites the project while substantial construction risk remains.

Development exit finance is generally used once that construction risk has materially reduced.

Its purpose is more commonly to:

refinance the development facility;

provide a sales period;

release equity;

or bridge into a longer-term refinance.

The two facilities therefore sit at different points in the development lifecycle.

What is the difference between exit finance and investment finance?

Investment finance is generally intended to hold an income-producing property over a longer period.

For example, a developer may complete a block of apartments and decide to retain them as rental investments.

If the property is:

complete;

lettable;

and suitable for long-term holding,

a buy-to-let or commercial investment mortgage may potentially become the eventual solution.

Development exit finance can potentially provide an intermediate period while:

units are leased;

valuations stabilise;

sales complete;

or longer-term refinancing is arranged.

Can exit finance be used before a buy-to-let refinance?

Potentially.

A developer may originally intend to sell a scheme but later decide to retain some units.

The development loan still needs to be repaid.

However, the units may not yet have:

sufficient tenancy history;

occupancy;

or other elements required by the long-term lender.

An exit facility could potentially bridge that transition.

The final investment refinance should still be credible.

Can some units be sold and others retained?

Potentially.

This is common with larger developments.

A developer might decide to:

sell part of the scheme;

retain part for investment;

and refinance the retained units later.

That creates a more complex exit.

The lender may need to structure:

unit releases;

debt reductions;

and the remaining facility

as sales complete.

Current market examples include transactions where some units were intended for sale while others were retained for rental.

What are unit release prices?

On multi-unit developments, the lender may agree how much debt needs to be repaid when each property is sold.

This is commonly referred to as a release price or release mechanism.

It allows individual units to be released from the lender’s security as they complete.

The structure needs to ensure that the lender’s remaining security stays within acceptable leverage as the scheme sells down.

This can be an important part of development exit finance.

Why does the release structure matter?

Because the sales are not simply reducing the number of units.

They also change:

the remaining property value;

the outstanding debt;

and the lender’s loan-to-value.

A poorly structured release mechanism could leave too much debt secured against the final few units.

The facility therefore needs to be designed around the expected sales sequence.

How much can you borrow with development exit finance?

The maximum depends on:

current value;

completed GDV;

remaining units;

borrower experience;

existing debt;

property type;

location;

and lender appetite.

Providers may assess the facility using metrics such as:

loan-to-value;

loan-to-GDV;

or another measure appropriate to the scheme.

There is no single market-wide maximum.

The important figure is the debt that can be supported by the remaining completed asset and exit strategy.

What is GDV?

GDV stands for Gross Development Value.

It is broadly the expected market value of the completed development.

For a multi-unit scheme, this may represent the combined value of the finished units.

For exit finance, the relevant lender may consider:

original GDV;

current valuation;

sales achieved;

remaining stock;

and actual realised prices.

Once units have begun selling, real sales evidence can become particularly useful.

Is the original GDV still relevant after completion?

Yes, but it may no longer be the only relevant measure.

Before construction, GDV is partly a forecast.

After completion, the lender can assess:

the finished asset;

actual market conditions;

completed sales;

current offers;

and remaining unit values.

The financing can therefore become more grounded in realised or current value.

Does the development need a new valuation?

Generally, a new lender will want its own valuation or other acceptable valuation evidence.

The valuer may assess:

individual unit values;

aggregate value;

marketability;

remaining works;

current sales evidence;

and potentially the value of the scheme on alternative bases.

A valuation prepared for the original development lender may not automatically be accepted.

Can completed sales strengthen an application?

Potentially.

Completed sales can demonstrate:

market demand;

achievable pricing;

buyer appetite;

and performance against the original GDV.

For example, if the first ten units have all sold close to or above valuation, this can give the lender useful evidence about the remaining stock.

But past sales do not guarantee future sales.

The remaining units may differ in:

size;

price;

orientation;

or market appeal.

What if sales are slower than expected?

That does not automatically prevent exit finance.

Indeed, a slower sales period is one of the reasons the facility may be required.

The lender will want to understand why.

There is a difference between:

a good completed scheme requiring more time

and

a development that is failing to sell because its values or product are fundamentally wrong.

The finance can create time.

It cannot manufacture buyer demand.

What if prices need to be reduced?

The lender may need to reassess the exit.

If the original GDV was £10 million but evidence now suggests the remaining scheme is realistically worth £8 million, the borrowing should be assessed against the current position.

A facility based on an outdated valuation can create excessive leverage.

The exit strategy needs to remain credible at realistic sale prices.

Can development exit finance prevent a forced sale?

Potentially, in the sense that it may remove an immediate refinancing deadline.

But the borrowing itself still has a maturity date.

The developer eventually needs to:

sell;

refinance;

or repay the facility from another source.

Development exit finance therefore buys time, not an indefinite solution.

That additional time needs a clear commercial purpose.

How long is development exit finance available for?

Terms vary between lenders and transactions.

Development exit finance is generally short-term rather than permanent borrowing.

Current specialist lenders offer facilities extending into periods such as 12 to 18 months, although precise terms vary.

The agreed term should reflect:

number of units;

expected sales rate;

seasonality;

refinance timetable;

and market conditions.

Is twelve months always enough?

Not necessarily.

Selling:

two houses

can require a very different sales period from:

50 apartments.

The lender and developer should consider:

number of units;

price points;

market depth;

reservations;

and realistic completion times.

A term that looks cheaper but creates another urgent refinancing requirement may not be the strongest structure.

What is the exit from development exit finance?

This sounds repetitive, but it is crucial.

The exit facility itself still needs a clear repayment strategy.

That may be:

individual unit sales

a bulk sale

investment refinance

refinance onto buy-to-let

sale of the whole development

another clearly evidenced source.

The lender needs to understand how and when its loan will be repaid.

Can refinancing be the exit?

Potentially.

For example, a completed residential block may eventually be refinanced onto a longer-term investment facility once:

units are let;

income is established;

and long-term valuation requirements are satisfied.

Development exit finance could bridge the period between practical completion and that refinance.

The long-term facility should still be realistic.

Future refinancing cannot simply be assumed.

Can a bulk sale be the exit?

Potentially.

A developer may intend to sell:

the entire block;

several units together;

or the remaining stock

to an investor.

The lender may want evidence around:

purchaser interest;

expected discount;

completion timing;

and whether the anticipated proceeds repay the facility.

Bulk sales can complete more quickly than individual unit sales.

They may also achieve a different price.

What if the developer intends to sell individual units?

Then the lender may model the sales programme.

That can include:

asking prices;

expected monthly sales;

current reservations;

release prices;

selling costs;

and the remaining debt after each completion.

The sales programme should be realistic rather than built around the fastest theoretically possible exit.

Does developer experience matter?

Yes.

Lenders may consider:

previous developments;

delivery track record;

experience with similar schemes;

sales performance;

financial position;

and existing portfolio.

Development exit finance is still specialist property lending.

A developer who has successfully delivered and exited several comparable schemes may present differently from a first-time developer dealing with a delayed project.

Can first-time developers use exit finance?

Potentially with some lenders, depending on the circumstances.

A completed asset substantially reduces some of the construction risk.

But experience can still influence:

lender appetite;

leverage;

pricing;

and underwriting.

The complete case matters.

Does the borrower’s financial position matter once construction is finished?

Yes.

The lender may still want to understand:

assets;

liabilities;

development portfolio;

other projects;

liquidity;

and contingent commitments.

A developer running several simultaneous developments may have a strong balance sheet but also significant obligations elsewhere.

The lender needs to understand both.

What if the developer has another project underway?

That can be one reason equity release is attractive.

The developer may want capital for:

acquisition;

construction;

professional costs;

or equity contribution elsewhere.

But the lender may also assess whether the second project creates additional financial risk.

Capital should not be released from one scheme without considering the developer’s wider development exposure.

Can development exit finance be used to purchase another site?

Potentially, where the lender permits capital release for that purpose.

A developer may refinance the completed scheme and use surplus proceeds as equity for the next acquisition.

This can accelerate the development cycle.

But it also means the developer is carrying debt on the completed scheme while committing capital to another project.

Liquidity needs to be managed carefully.

What costs are involved?

Potential costs can include:

lender arrangement fee;

interest;

valuation;

legal fees;

monitoring or professional costs where residual works remain;

broker fee;

exit or redemption costs;

and potentially fees for extensions or other amendments.

The existing development facility may also carry:

exit fees;

redemption fees;

or other costs.

The comparison should therefore consider the cost of leaving the existing facility as well as the cost of entering the new one.

Is the lowest interest rate the best exit facility?

Not automatically.

Developers may also need to consider:

leverage;

term;

release prices;

permitted capital release;

residual works;

valuation approach;

extension flexibility;

and speed of execution.

A marginally cheaper facility may prove less useful if it:

releases less equity;

requires unrealistic unit-release payments;

or provides insufficient time for sales.

The commercial structure matters as much as the headline rate.

Can exit finance be arranged quickly?

Potentially.

Speed can be important where the existing development facility is close to maturity.

Recent market case studies show development exit refinances completing in relatively short periods where the project, valuation, legal work and lender decision-making aligned.

But speed should not be assumed.

Potential delays can include:

valuation;

title issues;

outstanding planning conditions;

warranties;

building control;

remaining works;

and incomplete financial information.

Planning the refinance before the existing loan matures can preserve more lender choice.

When should a developer start considering exit finance?

Ideally before the development facility becomes urgent.

The developer may begin reviewing the exit when there is reasonable visibility around:

practical completion;

final costs;

sales;

valuation;

and the remaining development debt.

Waiting until the current loan has only a few days left can reduce options.

The strongest lender may not necessarily be the lender capable of completing under an emergency deadline.

What documents might a lender require?

Depending on the scheme, these could include:

current development loan statement;

original development appraisal;

latest cost report;

practical completion evidence;

building control documents;

warranties;

planning documentation;

valuation;

sales schedule;

reservation details;

completed sale information;

marketing evidence;

company accounts;

asset and liability information;

and details of the proposed exit.

Where works remain, the lender may also require:

cost-to-complete information;

contractor details;

and programme updates.

The precise requirements depend on the transaction.

Why are warranties important?

For residential development, appropriate structural warranty arrangements can be important to:

lenders;

purchasers;

and their mortgage providers.

A technically completed property that cannot yet be sold easily because documentation is incomplete may not represent a fully de-risked exit.

The lender may therefore want to understand whether the units are genuinely ready for normal market sale.

Does practical completion automatically mean the development is ready for exit finance?

Not necessarily.

The lender may also consider:

final certificates;

warranties;

planning conditions;

title;

utilities;

access;

sales readiness;

and remaining obligations.

Practical completion is an important milestone.

It is not the only underwriting consideration.

Is development exit finance regulated?

It depends on the transaction.

Many commercial development and development exit facilities are not regulated residential mortgages.

Current specialist lenders expressly note that some of their development finance and exit products are outside FCA/PRA regulation.

However, regulation can depend on:

borrower;

property;

occupation;

transaction;

and loan structure.

The regulatory position should therefore be established for the specific case rather than assumed from the product name.

Is development exit finance only for residential developments?

No.

Depending on lender appetite, exit finance can potentially be available across:

residential;

commercial;

mixed-use;

specialist living;

and other development assets.

Current specialist propositions explicitly include broader property types beyond straightforward residential schemes.

The available lender market will depend heavily on the completed asset and exit.

Can commercial developments use exit finance?

Potentially.

A commercial developer may need time to:

sell;

lease;

stabilise occupancy;

or arrange an investment refinance.

The valuation and repayment assessment can differ from residential unit sales.

For income-producing commercial property, the lender may place greater weight on:

rent;

lease terms;

tenants;

yield;

and investment value.

Can mixed-use developments qualify?

Potentially.

A scheme might contain:

residential apartments;

retail units;

offices;

or other commercial space.

The lender needs to understand the exit for each component.

One part may be sold individually.

Another may be retained.

The funding structure may therefore require more bespoke underwriting.

Can development exit finance be used on a single house?

Potentially.

Development exit is not limited to large apartment schemes.

A developer may complete a high-value individual residence but need additional time to sell it.

Depending on:

value;

leverage;

location;

and lender criteria,

either a development exit facility or bridging finance may be appropriate.

Can it be used for luxury developments?

Potentially.

But high-value individual properties can have longer sales periods because the buyer pool is narrower.

That can make the exit term particularly important.

The lender may consider:

local comparable evidence;

marketing history;

asking price;

liquidity of the market;

and borrower equity.

A £5 million property and a £500,000 property may both be complete, but their realistic sales periods can be very different.

What if the scheme has been on the market for a long time already?

The lender will want to understand why it has not sold.

Possible explanations include:

market conditions;

unrealistic pricing;

incomplete works;

poor marketing;

purchaser fall-throughs;

or limited demand.

Simply providing another 12 months of finance does not solve a fundamental pricing problem.

The lender needs confidence that the additional time creates a credible exit opportunity.

Can exit finance be used after a failed sale?

Potentially.

A bulk purchaser or individual buyer may withdraw late in the process.

That can leave the developer with a maturing loan and completed property.

Exit finance could potentially provide time to remarket.

The lender will still assess:

why the sale failed;

market value;

and the revised strategy.

What if the existing lender refuses to extend?

This can make refinancing particularly important.

A developer may have completed the scheme successfully but need more time to sell.

If the existing lender does not want to extend, a new development exit lender may potentially refinance the balance.

Recent lender examples show exactly this type of use, where slower sales and an unwillingness from the incumbent lender to extend created the need for exit finance.

Is an extension with the current lender sometimes better?

Potentially.

If the existing lender offers:

reasonable pricing;

sufficient term;

suitable release provisions;

and no unnecessary restrictions,

an extension may be simpler than refinancing.

The developer should compare:

the cost and flexibility of staying

with

the cost and flexibility of moving.

Development exit finance is an option, not an automatic requirement.

Why does the final exit need to be considered before taking the exit facility?

Because exit finance is itself temporary.

Replacing one short-term loan with another without resolving the underlying repayment strategy can simply move the problem forward.

A strong transaction should establish:

what will repay the exit loan;

how long that is realistically expected to take;

what happens if the plan is delayed;

and whether sufficient equity remains.

Development exit finance should create a runway towards repayment, not simply postpone the need to confront it.

How should development exit finance be assessed?

A useful framework is to consider seven areas.

1. Stage of development

Is the scheme complete or sufficiently close to completion?

2. Existing debt

What needs to be repaid and when does the current facility mature?

3. Current value

What is the completed or current market value of the scheme?

4. Remaining works

What still needs to be completed and what will it cost?

5. Sales or refinance strategy

How will the exit facility ultimately be repaid?

6. Capital requirement

Is the developer simply refinancing existing debt or also releasing equity?

7. Time

How long is realistically required to complete the final exit?

This provides a more useful basis for structuring the facility than simply searching for the highest available LTV.

How Henry Dannell can help

At Henry Dannell Private Clients, we approach development exit finance by understanding where the project sits within the wider development cycle.

The starting point is establishing:

the existing development facility;

the current outstanding balance;

practical completion status;

any remaining works;

the completed value;

sales already achieved;

remaining units;

the developer’s wider financial position;

and

the intended final exit.

We can then consider whether refinancing provides a meaningful commercial advantage.

For one developer, the priority may be repaying an expensive development facility and securing additional time for unit sales.

Another may want to release capital from a completed scheme to fund the next project.

A developer retaining part of a scheme may require an exit facility while longer-term investment finance is established.

And where limited works remain, a lender comfortable with near-completed developments may be required.

The objective is not simply to replace one loan with another.

It is to structure the period after construction so that the financing supports the developer’s intended commercial exit rather than forcing that exit prematurely.

The takeaway

Development exit finance is short-term funding used when a property development is complete or approaching completion and the original development facility needs to be replaced.

It can potentially help a developer:

repay existing development finance;

reduce financing pressure;

create more time for sales;

release equity;

fund the next development;

or bridge into longer-term investment finance.

The core distinction is straightforward.

Development finance deals primarily with construction risk.

Development exit finance deals primarily with repayment and sales risk after construction has substantially reduced.

That makes the final exit critical.

The useful question is therefore not simply:

“Can we refinance the development loan?”

It is:

“What does the developer need the additional time or liquidity to achieve, and how will the new facility ultimately be repaid?”

When those questions are clear, development exit finance can provide a valuable transition between completing a scheme and realising its final value.

The purpose of development exit finance is not to delay the exit indefinitely. It is to give a completed or near-completed development an appropriate financial runway to achieve it.

Important information

This article is for general information only and does not constitute personal mortgage, investment, tax, legal, development or financial advice.

Development finance and development exit finance availability, loan-to-value, loan-to-GDV, interest rates, fees, term, permitted residual works, unit-release provisions and other conditions depend on the borrower, development, security and lender at the relevant time.

Property valuations, Gross Development Values and anticipated sale prices are not guaranteed. Property values can fall as well as rise, and projected sales or refinancing may not occur within the expected timeframe.

Development and development exit finance may be unregulated depending on the transaction. The regulatory treatment should be established for the individual circumstances.

Any property or asset used as security may be at risk if borrowing secured against it is not repaid.