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Guide To Refurbishment Bridging Finance

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Refurbishment bridging finance is a short-term solution used to fund renovations, refurbishments, or improvements on a property. This type of funding covers the purchase, refurbishment, or conversion costs for residential or commercial properties.

What is refurbishment bridging finance?

Refurbishment bridging finance is a specialised funding option designed to facilitate property refurbishments or conversions. It’s a flexible short-term loan that covers the cost of purchase and the cost of the refurbishment works.

Who can benefit from refurbishment bridging finance?

This financing option is available to anyone looking to enhance the value of a property through renovation or conversion. A key consideration when using this product is time scales. Make sure you allow ample time for the renovation works as well as the time for your desired exit route e.g., sale or refinance.

Loan-to-value ratio and eligibility

Depending on the property type and your experience, you can typically secure up to 70% of the property’s value from day one. Moreover, you might access up to 100% of the refurbishment costs or 65% of the Gross Development Value (GDV), whichever is lower.

What assets can I bridge?

Refurbishment bridging finance is suitable for various property types. This includes residential properties that were previously deemed un-mortgageable, properties where refurbishment will increase the value as well as those earmarked for conversion into HMOs (house of multiple occupancy), holiday lets, or buy-to-let units.

How much does refurbishment bridging finance cost?

Interest rates for refurbishment bridging finance start at 0.8% per month. Understanding the rates available is essential to assess the financial feasibility of your project.

Access to 100% Bridging Finance

Under specific circumstances, accessing 100% bridging finance is feasible. This often involves leveraging additional collateral or security to support your loan application.

How much can I borrow?

Bridging finance typically starts from £50,000 upwards, although some providers have a minimum loan size requirement ranging between £100,000 and £150,000.

Speed of Completion

The application-to-completion process for refurbishment bridging finance generally spans 2 to 4 weeks. However, in certain situations, expedited completion might be possible based on your unique circumstances and requirements.

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