What is a refurbishment loan?
Property conversion or refurbishment bridging loans are short-term finance options used to either fully convert, or simply refurbish, a property. They were originally designed for landlords, property investors and developers before renting or selling an asset, to enhance property value.
These forms of bridging loans allow you to purchase a property, extend and renovate both the interior and exterior, to produce the best version of your property.
Whether it’s for your main area of residence or an asset in your property portfolio, a refurbishment or conversion bridging loan can be a great way to create more space whilst increasing the property value, and it’s an avenue that has the potential to open many doors.
How can I use these loans to improve my property?
Here are examples of what works are available under our refurbishment and conversion loans:
What we do:
- Refurbishment projects / upgrades
- Light developments
- Planning permission required
- Planning permission applied
- Short leases > 40 years
- For applicants wishing to purchase or refinance semi-commercial / commercial property
What we do:
- Multiple to single
- Single to multiple
- Change of use
- Ground floor extensions
- Barn conversions
- Light refurbishments
If you have any questions, then don’t hesitate to get in contact. Fill out one of our enquiry forms today and a member of our team will be in contact in as little as 4 hours.
When using a refurbishment loan, are there specific types of work I need to adhere to?
This will depend on the lender that you’re using, as each will have their own set of rules that apply to their loan. It can therefore range from light refurbishment to structural changes, so make sure your loan is tailored to the work you need.
If you’re worried about additional fees on top of your initial funding, such as professional or project management fees, we can help.
We provide bespoke bridging loans, as each case is as unique as you.
Once I have added value to my property, is it possible to draw this money out?
Once again, additional lending will depend on the bridging lender providing the loan.
If accepted, you will have to ensure that the works are completed which will need to be confirmed by the surveyor, this also ensures they are to correct standard.
Most buy-to-let mortgage lenders will happily allow you to take out some of, if not all, the profit made, if you choose to exit your bridging loan through refinancing.
However, it could be cheaper for you to wait, complete, then take the funds directly out of the property.
Here at MFS, our tailored loans are made to suit your specific needs, so let us help you find the best option for your financial situation.
Do building regulations apply?
If you’re only looking to complete small changes on your property, then you will most likely need a Light Refurbishment bridging loan, which means they do not apply to building regulations.
Light refurbishment consists of work that ultimately does not change the nature of the premises in any structural way, usually relating to the design of the interior.
These tasks generally relate to works such as:
- Maintenance works such as replacements or repairs (excluding heating systems, fuse boxes oil tanks, glazing units)
- Electrical works such as new power / lighting points and changing current circuits (excluding areas close to the baths / showers)
- Bathroom unit refurbishment such as replacing basins, sinks, showers and baths
If you are looking to refurbish your property for commercial use, then a light refurbishment loan would not be suitable.
If you’re looking for more detail on whether building regulations apply to your project, then click here to be directed to the government’s website.