Property Refurbishment Finance

If you are involved in the building industry or make a living from property refurbishment then funds are available for profitable projects. Property refurbishment finance and loans can be arranged from £50K upwards.

Property refurbishment projects often fall into one of the following five scenarios:

  • Buy a single residential property and upgrade it to a higher value or rental value.
  • Buy a multiple unit property (HMO or multiple properties on a single freehold) and upgrade to a higher value or rental.
  • Buy a large single residential property and convert it into a non-licensed HMO, or a multiple unit property.
  • Buy a large single residential property and convert into a licensed HMO which will require planning permission.
  • Buy a commercial unit and convert it into single or multiple residential properties.

Light Refurbishment Loan

Generally this is for single or multi-let properties being upgraded rather than changed in any substantial way. The property has to be mortgage-able on day one or ‘almost’ mortgage-able. Therefore, upgrading an existing kitchen or bathroom is light refurbishment.

Heavy Refurbishment Loan

In contrast to light refurbishment, this type of loan is generally put into place when structural works are required to the property or where the costs of refurbishment are substantially higher than 15% of the purchase price.

The property does not have to be mortgage-able on day one, but the main structure should still be in place. The time taken to do the works can be longer than 3 months but usually not longer than 6 months.

Refurbishment To Term Loan

A refurbishment to term loan is designed for the client who plans to hold onto the property for the long-term rather then sell it on. This type of finance not only covers the refurbishment phases, but also offers an automatic conversion on completion to a long-term, better rate loan.

Benefits Of Property Refurbishment Loans

  • Ability to lend on properties that are not mortgage-able for the buy to let market.
  • For the experienced builder with high refurbishment costs, some lenders will allow part of the build costs to be funded in a single tranche in addition to the lenders purchase contribution.
  • With a refurbishment to term loan the worries of being able to refinance on completion of works is removed.
  • Increasingly, lenders are allowing on completion the ability to take out potentially all of the costs of purchase and refurbishment. This allows the client to move onto their next refurbishment project.

Whatever your requirement for property refurbishment finance please contact us for a no obligation discussion, best advice and a same day quotation. Please call us today to see how we can help or submit an enquiry and we will contact you.

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