The residual still shows a blank where the Community Infrastructure Levy should sit. Build cost is elemental. GDV looks fundable. Then the solicitor asks for the liability notice and the broker has a planning portal status line, not a PDF. The development finance enquiry does not fail on LTV. It stalls on developer contributions the desk cannot price.
StatusKWO prices commercial works facilities for professional developers, investors and corporate SPVs. Main-home owner-occupier lending is outside that book. Short commercial facilities on the published schedule currently show a monthly rate from 1.25%, an entry fee of 2%, an exit fee of 1.5%, LTV up to 85%, loans from £10,000 to £10,000,000+ and terms up to 16 months. Development facilities are priced on the scheme. Treat those bridging figures as a schedule reference only.
The residual that still ignores CIL until the solicitor asks on day nine
A tidy decision in principle on GDV alone is not a funded first draw. Credit needs the cash that planning obligations and infrastructure levies will pull out of the project. Our planning decision notice pack covers consent and conditions. The build-cost and drawdown pack covers spend and releases. What follows is narrower. It is the CIL and section 106 evidence a specialist desk wants before it prices an unregulated commercial works facility.
Start with one page. Site address and title number. Local planning authority and collecting authority. Application reference. Decision date. Units or floorspace. CIL charging schedule status for the area. Liability notice date and chargeable amount. Who has assumed liability. Commencement status. Demand notice dates and instalments. Signed section 106 status. Named triggers and amounts. Relief or exemption claimed. Gross and net facility. Named exit. Borrower name. Then attach the PDFs. A covering line that says “CIL TBC” does not underwrite a programme.
Late papers burn interest. A residual rewritten after offer because nobody modelled the levy is how facilities lose a month. That rewrite is avoidable. Brokers who treat developer contributions as a solicitor footnote after the valuation often discover the bill when the contractor is already priced. Send the notices with the first appraisal. Pricing then stays about cost and exit.
Section 106 versus CIL and why credit needs both cash stories
They are not the same instrument. Mixing them in one vague “planning costs” cell is how residuals break.
GOV.UK’s planning obligations guidance covers section 106 agreements and unilateral undertakings. Obligations mitigate site-specific impacts. They run with the land. They are legally binding. They may only be a reason for granting permission when they are necessary, directly related to the development and fairly related in scale and kind. Affordable housing. Highway works. Open space. Education contributions. Monitoring fees. Each line needs an amount and a trigger.
GOV.UK’s Community Infrastructure Levy pages cover the fixed charge levied on liable development to fund infrastructure. CIL is schedule-driven. It is not a negotiated package of site-specific works. Credit still wants the live notices for the scheme being funded, not a broker paraphrase of what the architect remembers from committee.
Authorities can use both routes. GOV.UK’s developer contributions data guidance treats section 106, CIL and related agreements as parts of the same money story. Put both cash paths on page one when both exist. A GDV that models only build cost and ignores contributions is marketing. It is not a residual.
Highway agreements and water adoption often sit beside the section 106. Name them. Attach draft or completed documents. A facility that funds foundations while the highway agreement is unsigned can leave a finished block that cannot be adopted or sold cleanly. Credit prices that hang. Do not bury it in an informative.
Liability notice assumption of liability and who actually pays
CIL paperwork follows a sequence. Brokers who skip it leave credit guessing who will write the cheque.
After permission, the collecting authority issues a liability notice. Planning Portal CIL form pages set out Form 2 for assumption of liability, Form 3 for withdrawal, Form 4 for transfer, Form 5 for notice of chargeable development under general consent and Form 6 for commencement. Put the live liability notice PDF in the zip. A cropped screenshot that hides the chargeable amount or the payment procedure fails.
Someone must assume liability before commencement if the file wants standard payment windows and instalments. GOV.UK guidance is plain. Landowners are ultimately liable, but anyone involved in the development may take on the liability to pay. Where nobody assumes liability, the charge defaults to landowners and payment becomes due as soon as development starts. Say who has assumed liability on page one. Attach the Form 2 acknowledgement. Silence forces the underwriter to treat the landowner as the payee and to price default timing.
Transfers matter on live SPV files. A director who assumed liability personally while the SPV takes the facility needs a clean Form 4 story before first draw. Withdrawal before commencement needs Form 3. After commencement, liability moves by transfer, not by quiet email. Credit will ask. A broker who says “the SPV will pay” with no form attached still gets a chase.
General consent and permitted development routes can need a notice of chargeable development. Do not assume a prior approval letter clears CIL paperwork. Check the collecting authority route and attach Form 5 when it applies. Wrong form. Wasted week.
Match the address and planning reference on every notice to the title and the valuation instruction. Wrong plot numbers create legal delay that a twelve-month facility does not absorb. If the liability covers a wider site than the charged title, draw the red line. Credit needs to know which charge travels with which security.
Commencement notice demand notice and instalment clocks on a live facility
Payment follows commencement. Credit prices that clock next to the first works draw.
A commencement notice must reach the collecting authority before works start. Planning Portal Form 6 is the usual route. GOV.UK guidance treats late or missing commencement notices as a route to surcharges and to the loss of instalment rights. Put the intended start date and the lodged Form 6 status on page one. A facility that assumes foundations in fortnight one while Form 6 is still unsigned is already soft on paper.
The collecting authority then serves a demand notice. That notice sets the amounts due and the payment dates, including any instalment policy the charging authority has published. Attach the demand notice when it exists. If works have not started and the demand notice has not issued, say so and show the liability amount plus the instalment policy PDF for the area. Guessing the payment profile from a neighbour’s scheme fails.
Instalments change cash flow. A single bullet payment on commencement hits equity harder than a staged policy. Put the instalment table next to the drawdown schedule. Our build-cost pack already wants elemental spend. CIL instalments belong in the same waterfall. A first draw that funds slabs while the demand notice expects a large CIL cheque in the same week needs both lines visible.
Surcharges and interest on late CIL are real cash. They are not soft contingency. If the borrower has already missed a commencement notice on a related phase, say so. Credit would rather price a known surcharge than discover it when monitoring starts. Professional borrowers who model the levy early get faster answers.
Phased permissions need a map. Which phase carries which liability notice. Which phase is charged. Which phase is funded. Portfolio finance take-outs that rely on early units need the phase that actually completes first marked on the schedule. Averaging CIL across a multi-phase consent hides the weak plot that kills the refinance.
Signed section 106 triggers affordable housing and highway cash
Heads of terms are not a substitute once the agreement is executed. Send the signed deed.
List every financial and non-financial obligation on page one. Clause reference. Exact trigger. Amount or unit mix. Payment or delivery status. Occupancy triggers that land before sales receipts arrive create cash holes mid-facility. Education contributions that fall due on first occupation of unit three need a sales programme that can fund them. Silence forces the underwriter to invent a worst case.
Affordable housing obligations change exit quality as well as cash. Nomination agreements, registered provider contracts and tenure mixes sit beside the GDV model. A residual that prices every unit at open market while the deed reserves a slice for affordable tenure will be rewritten. Put the tenure schedule next to the appraisal. Credit reads both.
Highway works under section 106 or related section 278 agreements need the same honesty. Draft agreements that still hang on bond wording can freeze adoption and sales. Attach the latest draft or completed deed and the bond status. A monitor who finds the highway agreement unsigned after groundworks have started is writing a delay letter, not a draw certificate.
Monitoring fees and indexation clauses need a date. An amount agreed two years ago may not be the amount due at trigger. Say which index applies and when the last calculation landed. Brokers who paste an old heads-of-terms figure into a live residual usually get a correction from the local authority later.
Unilateral undertakings still bind the landowner side. They do not bind the authority the same way a bilateral agreement does. Label which instrument is live. Credit prices enforceability and delivery risk differently when the council is not a party to the deed.
Negatively worded planning conditions that ban commencement until a planning obligation is entered into need the draft or completed agreement in the pack. GOV.UK guidance prefers obligations to be completed before permission where possible. Live files still arrive with conditions hanging. Price the hang. Do not pretend it is cleared.
Relief exemptions and what happens when a claim falls away
Relief is not a free pass. It is a conditional reduction that can rebound as a bill.
Social housing relief, charitable relief, self-build exemptions and other claims sit on GOV.UK CIL guidance and on Planning Portal claim forms. Attach the claim form, the decision and any clawback or disqualifying event wording. A residual that books full relief with no paperwork is hope. Credit will ask what happens if the claim fails or if a disqualifying event lands inside the facility term.
Commencement notice timing still matters when relief is granted. GOV.UK guidance notes surcharges where commencement notices are late even after relief. Put Form 6 status next to the relief decision. A broker who treats relief as “nil CIL forever” without the commencement paper still leaves a surcharge risk on the file.
Exceptional circumstances relief is rare and tightly framed. Do not lead with it unless the charging authority has confirmed the route and the evidence pack is real. Viability statements that argue for reduced section 106 contributions are a different conversation from CIL exceptional relief. Label which route is live. Mixing them in one email creates lawyer time that burns interest.
Phased credits and further relief claims need their own forms. Attach them. A later phase that expects credit from overpayment on an earlier phase needs the Form 14 path documented when that is the collecting authority route. Credit will not invent the offset.
What brokers should put in the first developer-contributions zip
Keep the folder boring and complete. Credit hates rebuilding five different trees.
One-pager as above. Decision notice for context. Live CIL liability notice. Assumption of liability form and acknowledgement. Commencement notice status. Demand notice or instalment policy. Signed section 106 or unilateral undertaking. Highway and related agreements. Relief claim papers. Cash waterfall extract showing CIL and obligation lines next to build cost. Title plan red line that matches the notices. Named exit and how contributions affect sale or refinance timing.
Our planning permission overview covers consent risk at a high level. The bridge versus development split covers product choice. Light works that truly belong on a short bridging loan still need a clear contributions story when the exit assumes lawful completed units. Mis-labelling a rebuild as a sixteen-month light refurb wastes the first week.
Auction finance buys with planning risk already priced into the hammer. Lots sold with outstanding section 106 payments or unclear CIL status still need the notices inside the wider legal pack. Deposit equity burns when the buyer discovers a demand notice after the hammer. Put the contributions folder with the memorandum papers, not after day twenty.
Exit quality sits on the finished, lawful product. Sale exits need a residual that still works after contributions. Refinance exits need a product a term lender will take, including warranties, certificates and any occupancy restrictions tied to obligations. Our exit finance note covers the refinance path. The sale-exit evidence pack covers marketing and Plan B. The contributions pack still has to prove the cash that leaves before those exits close.
Source of funds for equity and planning cash sits in the same submission. Obligation payments and CIL instalments are real money. They are not free. Our general bridging pack note covers identity and money trails. Put developer-contribution cash inside that trail when the borrower is funding it.
Brokers should open the decision in principle engine when the loan, term and security are known, then attach the contributions folder in the same go. Do not wait for credit to ask for the obvious liability notice. Files that pause for a perfect pack often miss the week when the contractor could still hold the price.
Keep collecting while the DIP is out. A signed section 106, a demand notice or a relief decision can land in the same week as the valuation. Drop each one into the zip as it arrives. Credit notices when the contributions story stays current. It also notices when the last CIL email is three months old and the residual still shows a blank.
Heavy works dressed as a short bridge create the same stall. Say so early if spend needs staged releases against certificates while assumption or commencement steps remain open. Do not force a light-refurb story onto a rebuild that planning cash has not unlocked. The desk prices professional developers who already treat the levy and the deed as part of the loan.
Frequently asked questions
Can StatusKWO price development finance without a CIL liability notice?
Rarely on a chargeable scheme in a charging area. A DIP may sketch terms from a clear appraisal, but works draws need the liability figure, assumption status and a residual that shows the cash. “CIL TBC” comes back as questions.
What proves that someone has assumed CIL liability?
A completed assumption of liability notice lodged with the collecting authority, plus the authority’s acknowledgement where issued. A broker email that names the SPV is not assumption.
Do section 106 heads of terms replace a signed agreement?
No. Heads of terms help early pricing. Credit still wants the signed deed or a clear status note on what remains unsigned, with amounts and triggers listed.
How should CIL instalments appear next to the drawdown schedule?
As dated amounts against the demand notice or the published instalment policy, sitting in the same cash waterfall as build cost and equity. Do not hide them inside contingency.
Where should brokers start with StatusKWO on a contributions-led works file?
Open a decision in principle with the site, loan, term, GDV and exit, then attach the liability notice, assumption papers, commencement status, demand or instalment policy, signed section 106 and the residual extract in one submission. A clean contributions pack is faster than a long covering story.
