Posts Tagged 'Refurbishment'

Bridging Finance for refurbishment of property

Pros and Cons of Bridging Finance when you Refurbish Property

Bridging finance is a short-term loan that can be used for a variety of purposes, including property refurbishment. It can provide quick access to funds for refurbishment projects, but it also comes with its own set of risks.

In this post, we’ll take a closer look at the pros and cons of using bridging finance for property refurbishment, as well as some tips on how to obtain it.

The Pros of Bridging Finance

One of the biggest benefits of bridging finance is speed as it can provide quick access to funds. This can be especially useful for property refurbishment projects, which have multiple property investors interested in the project.

Additionally, bridging finance offers more flexibility in terms of repayment options, which can make it easier to manage your cash flow during the project. Most lenders will allow you to pay the interest at the end, when the property has been sold or remortgaged.

Finally, it allows you to obtain finance on properties that are not mortgageable and allow you time to improve the quality and marketability of the property pending sale or remortgage.

The Cons of Bridging Finance

While bridging finance does have its advantages, it’s important to be aware of the potential downsides.

One of the biggest cons is that bridging finance often comes with higher interest rates than traditional loans.

Additionally, the repayment terms are often shorter, which can make it more challenging to pay off the loan in a timely manner.

Finally, there is always the risk of defaulting on the loan, which can lead to serious financial consequences.

How to Obtain Bridging Finance for Property Refurbishment

Obtaining bridging finance for property refurbishment can seem daunting, but it doesn’t have to be. Here are five steps you can take to make the process as smooth as possible:

Step 1: Research different types of financing options.

Before you apply for a loan, take the time to research different types of financing options. This will help you understand the market.

Yes, you can talk direct to the lender but remember they will be bias and won’t necessarily tell you the points you need to watch out for which may trip you up during the project.

We are also bias as brokers in the sector when we say that you should talk to an experience bridging finance broker who knows which lenders to go to, but more importantly the ones to avoid.

This will help you understand the different terms, interest rates, and requirements required for each option, and determine which type of bridging loan best suits your needs.

Step 2: Determine the amount of financing required.

Knowing how much financing you need is crucial in order to apply for the right type of loan. Consider all the costs of the refurbishment project, including purchase costs, solicitors, materials, labour, and any other expenses that may arise. Always include a contingency of at least 10%.

Step 3: Find a reputable lender.

That’s where we come in. When searching for a lender, it’s important to find one that is reputable and has a good track record.

Look for a lender that specialises in bridging finance for property refurbishment and some of them will also give you a long term Buy to Let Mortgage to pay it off. That reduces costs and increases your profits.

Step 4: Prepare a detailed project plan.

When applying for a loan, you will need to provide a detailed project plan and budget. This should include an estimate of the costs of the refurbishment, a timeline for completion, how it will get repaid and any other relevant information that will help the lender understand the scope of the project. We will help you with this.

Step 5: Submit a loan application and provide all necessary documentation.

Once you have all the necessary information, we can submit your bridging loan application to the lender. Be sure to provide all the required documentation, such as schedule of works, ID and address proof, details of experience and any other information that may be requested by the lender.


Bridging finance can be a useful tool for property refurbishment projects, providing quick access to funds and the potential for higher returns on investment.

However, it’s important to consider the higher interest rates, shorter repayment terms, and the risk of default before making a decision. By following the five steps outlined above and doing your research, you can help ensure that you obtain the right type of loan for your renovation project.

For your next project get in contact with us so we can help you obtain the finance you need.

Refurbishing your HMO

Unlocking the Benefits of a Successful HMO Refurbishment

HMO (House in Multiple Occupation) properties can be a great investment for landlords looking to obtain a higher yielding rental income. However, over time, these properties can become tired and in need of a refurbishment.

A well-planned and executed refurbishment can not only improve the living conditions for tenants, but it can also increase the property’s value and rental potential.

The Benefits of Refurbishing a HMO Property

  • Increased rental income: A refurbished property is likely to command higher rental prices than a tired, outdated property.
  • Attracting higher-quality tenants: A refurbished property is more likely to appeal to professional, reliable tenants who will take care of the property.
  • Increased property value: A refurbished property is more likely to hold its value, and may even increase in value over time.
  • Improved living conditions for tenants: A refurbishment can improve the living conditions for tenants, making the property a more pleasant place to live.

Key Considerations for a Successful HMO Refurbishment

  • Planning permission: Depending on the extent of the refurbishment, planning permission may be required. It’s important to check with your local council before starting work.
  • Health and safety regulations: It’s important to ensure that the refurbishment complies with all relevant health and safety regulations to protect tenants and contractors.
  • Building regulations: The refurbishment must comply with all relevant building regulations to ensure the safety and structural integrity of the property.
  • Budget: It’s important to have a clear budget in place to ensure that the refurbishment is completed within financial constraints.

The Refurbishment Process

  • Assessing the property: Before starting the refurbishment, it’s important to assess the property to identify any issues that need to be addressed.
  • Designing the refurbishment: Once the issues have been identified, the next step is to design the refurbishment to address these issues.
  • Obtaining quotes: Once the design has been finalised, it’s important to obtain quotes from contractors to ensure that the refurbishment is completed within budget.
  • Completing the refurbishment: Once the quotes have been obtained, the refurbishment can begin. It’s important to regularly check on the progress of the work to ensure that it is completed on time and to a high standard.

Finance Options for Your Refurbishment

If the refurbishment is going to take more than a month, there is structural work or you are changing the planning usage of the property it is highly likely you will need to tell any existing lender in advance what your plans are.

The lender may allow the work or they may tell you to get finance from elsewhere and repay your current mortgage.

You could either go down bridging finance route, a bridge to let or even a light refurbishment buy to let.

There are many options depending on the work and how long it will take.


Refurbishing a HMO property can bring many benefits, including increased rental income, attracting higher-quality tenants, and improved living conditions for tenants.

However, it’s important to carefully consider key factors such as the right type of finance, planning permission, health and safety regulations, building regulations, and budget to ensure a successful refurbishment.

By following a clear process, landlords can create a property that is both valuable and appealing to tenants.

To find out what your options are please contact us.

Bridging Finance for refurbishment of property

Light Development Finance

This is ideal for professional developers. You have the deposit, can cover the interest and fees, but could do with some help on the refurbishment costs. This product may be perfect for you.

A minimum loan size of £200,000 with a Day 1 loan of up to 75% LTV and a projected gross development value of 70%. You need a minimum of 20% profit on all costs.

Up to 100% of costs of works funded in arrears so you need working capital to cover the first 4-6 weeks of costs, the deposit and the fees.

Permitted uses for the product:

  • PDR schemes
  • Property conversion to residential / HMO
  • Heavy property refurbishment and extension
  • Finish and exit

It’s not for ground up development as we have other lenders for that. Legals and valuation at cost with no lender mark up.

Contact us now for a detailed quote.

Refurbishment Lending for Costs


  • Initial Loan 70% of the value
  • Refurbishment costs 100%
  • Gross facility up to 70% of end sales value
  • Loan size £250,000- £1.5m
  • Term – up to 18 months
  • Minimum value £300,000
  • Works must be lower of 50% of current value or £500,000
  • Experience essential

Suitable for

  • Extensions
  • Conversions
  • Planning
  • Permitted development
  • Heavy refurbishment
  • Structural works

Light Refurbishment Finance

Has your BTL mortgage been refused due to the condition of the property?

Improve the value and the rent on a tired property. Whether it be a new kitchen, bathroom, damp, electrics we have lenders for all of them at competitive rates up to 85% LTV with experience and 75% without.

Contact us for refurbishment finance options.

Refurbishment BTL products

Anytime I get asked for bridging I ask is there an alternative? If you don’t have to complete quickly and the property has a kitchen and bathroom there may be BTL refurbishment mortgages out there as an alternative.

It is provided in two amounts.  The lender will provide a loan of up to 80% of the lower of the purchase price or valuation. The valuer is provided with a detailed schedule of works and they provide an after works valuation along with a rental figure. The lender will base their end loan on the completed value and rent. The difference between the two is retained by the lender (retention).

The work is completed and the valuer does a re-inspection. If the after works valuation is confirmed then the retention is released to you.

If you are looking to convert a property into an HMO then with experience you have access to a specialist HMO refurbishment mortgage or you use cash or bridging finance.

Searchlight Finance Ltd is a broker not a lender.

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We are a credit broker not a lender.

Searchlight Finance Ltd is registered at 98, King Street, Knutsford, Cheshire, WA16 6HQ. Company Register number is 07929050.

Authorised and Regulated by the Financial Conduct Authority. Our FCA registration number is 743220. You can check via www.register.fca.org.

We are registered with the Information Commissioner’s Office, Z3109319 and you can check via www.ico.org.uk.

We conduct both regulated and unregulated business and therefore not all products provided through us are regulated by the Financial Conduct Authority.

We source finance from the whole of market and may receive commissions that will vary depending on the lender, product, or other permissible factors. The nature of any commission model will be confirmed to you before you proceed.

Member of National Association of Commercial Finance Brokers (NACFB).