Refurbishment Finance: Finance to refurbish or renovate a property
Bringing property back to life can be rewarding - if you can call on the right kind of finance
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Current Terms Available
- 1 to 36 months
- £25,000 – No Maximum
- Monthly rates starting from 0.35%
- Non-status and full status
- Interest roll-up schemes
- Adverse Credit – no problem
- No Income Proof Required
- Funding can be available in 5 – 7 business days
- Funds for any legal purpose
- Up to 100% Loan to Value available
- Land purchase or refinance up to 70% of value
- Commercial, Residential and Land
Speak to real business finance experts who really understand business financeProperty refurbishment can be lucrative, but buying a property and funding work needs special financial arrangements. We know the lenders who can provide them, and use our contacts to help you secure the deal that's right for you.
Bringing a property back to life can be a very rewarding business, and profitable.
Of course, there are some hurdles, with planning rules and building regulations to consider. Careful budgeting is important, too - you need to cover architects and planning fees, specialist contractors, materials and contingencies.
You have enough to do without searching through all the lenders and products available to ensure you get the right financing. At Rangewell, we believe that a specialist Refurbishment Finance arrangement could provide the solution you need.
Refurbishment Finance is designed specifically for property professionals looking to refurbish or improve existing properties. It differs from Development Finance, which is generally intended for major ground up construction. Instead, Refurbishment Finance is used for projects that may retain original structures and use, but which will update them to meet modern standards. It could provide the answer when you want to you buy and refurbish both residential property and commercial property
Light or heavy refurbishment?
Refurbishment Loans are available for both light and heavy refurbishment.
If a property simply needs redecorating, rewiring or relatively minor changes, such as newly fitted kitchen or bathroom, this can be arranged through a Light Refurbishment Mortgage, which may cover both purchase or the works alone. Light Refurbishment Mortgages are ideal for developers looking to refurbish a property as an investment, especially those properties where a conventional mortgage might not be available because of the condition.
A light refurbishment property should be currently habitable with working utilities.
The work required should not require any planning permission approvals, or structural work that requires building regulations approval. There should not be any change to the use of the property.
If the works require a change of use, for example, converting offices into flats, or any structural works requiring consent from the local authorities, this would be considered a heavy refurbishment project and would require a heavy refurbishment mortgage. Heavy Refurbishment Mortgages allow experienced property developers and investors to fund both the purchase of a property needing work, and the funds to carry out the refurbishment required.
The refurb may include conversion of a single building into multiple letting units, such as self-contained flats or a multi-tenancy home of multiple occupation (HMO), where reconfiguration may be necessary.
With heavy refurbishment, the lender will want to see a schedule of works. This is a detailed breakdown of the work and costs involved in the project, together with projected timings. A valuer will comment on whether the intended budget is realistic and if the time scale is achievable.
Lenders may also want to see evidence of your past projects, to ensure that you have the skills and vision to complete the work.
How Refurbishment Finance works
Refurbishment Finance is based on the gross development value (GDV), the value of the project once completed. This is also known as the post refurbishment works value.
Loans may available from £100k to £10m. Lenders may consider lending up to 70% of GDV, with funds released in stages. These funds may cover both the property purchase as well as refurbishment works, although funds may also be available for developers who already own a property in need of work.
Terms of up to 18 - 24 months are available, and interest payments may be rolled up in the total loan amount.
As with all property finance, there will also be fees:
These are charged by the lender for arranging the loan and are typically 1.5% to 2% of the loan amount.
Not all lenders apply exit fees - those that do may charge a percentage of the loan amount or, sometimes, the gross development value.
Lenders will instruct a surveyor to value the property both before and post refurbishment works. The scale of these fees will depend on the size of the project.
REAL EXAMPLES OF WHAT WE CAN DO
Help arrange funding for a builder bringing a row of Victorian terraced housing to modern standards
Find the most competitive funding arrangement to refurbish a bank at the heart of a historic city centre and convert it into a retail centre
Find finance to allow the purchase of a derelict industrial property and its conversion into a business hub
Arrange funding to convert a Georgian townhouse into prestige offices
Helped set up refurbishment finance for property after damage by tenants had led to a possession order and eviction
How Rangewell can help you set up Refurbishment Finance
All types of property finance demands expertise because of the large sums involved.
At Rangewell, our team of finance advisors includes people with specific expertise across the property sector. They can help you find the right kind of finance arrangement for your refurbishment needs, whether you are an experienced developer with a major project, or a property owner seeking to increase the value of your investment
Our service is personal. We can work with you to understand your project and the potential as well as the costs. When you call us, we can explain the options that may be available, and help you arrange the most competitive finance to meet them.
Helping you build your profits
Heavy refurbishmentHeavy refurbishment finance may be suitable for experienced developers working on projects requiring construction or conversion works.
Light refurbishment financeHabitable property that requires light work to increase its value can be funded with Light refurbishment finance.
Funding all types of property workBy arranging the right kind of refurbishment finance, all kinds of refurbishment work can be funded, from decoration to conversions and change of use.
No monthly costsInvestment charges can be rolled up into the final payment.
Fixed paymentsPayments are usually agreed at the outset, letting you budget ahead with confidence.
Staged paymentsStaged payments provide funds as they are needed, reducing your interest charges.
Download Rangewell’s free and detailed guide to Property Finance
What types of property finance are there - which do you need?
Refurbishment or development?
Why not all providers are equal - finding the one that’s right for you
How we can help you pay less than 0%
The downsides to property finance- and how to avoid them
How to arrange property finance - What paperwork do you need?
Key terms explained
Lending secured on your propertyYour property may be at risk if you are unable to make the repayments on a refurbishment loan.
Staged payments require verificationWork must be completed to an independent valuers satisfaction before each staged payment can be released.
Short-term commitmentRefurbishment loans are for the short term. If you are unable to repay, by either selling the property or arranging alternative finance, your property may be at risk.
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