The firm provided a sales guarantee and interest-free cash release to D T Joseph, enabling the housebuilder to bring forward a site they had owned for some time.

The project had been impacted by Covid-19, material costs and other unforeseen circumstances, and at the end of the finance term seven unsold homes remained, which amounted to almost half the site.

The housebuilder worked with LDS to complete on the units and was able to fully repay the lender, Assetz Capital — including interest and fees — and the developer was able to avoid defaulting, moving onto other schemes.

Andrew Fraser, CCO at Assetz Capital, commented: “With the loan term due to expire, the developer exercised their right to call on LDS to purchase seven of the homes on the development.

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“True to the agreement, LDS swiftly completed the purchase of these properties ensuring DT Joseph was able to repay the loan in line with the initial agreement.”

Mark Hawthorn, CEO at LDS, said: “Our role is to remove uncertainty, so we are always prepared to purchase properties if called upon as the market continues to soften.

“With rising rates and weakening demand we expect to make further acquisitions for our investment portfolio.

“This was a cash purchase concluded at short notice with minimum fuss [and] we have substantial reserves and underwriting capacity for new business.”

Mark Roberts, relationship director at LDS, added: “We are seeing increased deal flow as housebuilders and their lenders recognise the benefits of our sales guarantees in a down market.

“We are also seeing situations where [lower than expected] valuations and increased interest costs are creating equity shortfalls, potentially killing deals.

“Our ability to release our 10% cash deposit can remove these shortfalls and is often the difference between a site moving forward or remaining undeveloped."