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Module 06
Finance Secrets: Part B
In this part of the Finance Secrets section, we will be covering further detailed aspects of the development funding model. Financial templates can now be used to assist the modelling process and provide guidance on achieving target project returns.
Leverage
The concept of leverage can be applied in real estate by using borrowed money to make a return on your investment. When unlocking development finance for your project, you provide leverage by maximizing the loan amount relative to the equity in the deal. Increasing the leverage means borrowing more in proportion to the equity invested in the project.
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