Refurbishment bridging loans for light, medium and heavy works
A property that needs work usually can't get a mortgage, and you don't want to fund the works from your own cash. A refurbishment bridging loan funds the purchase and the works, then is repaid when you sell or refinance onto a buy-to-let or commercial mortgage at the improved value.
Rates from 0.59% a month, up to 90% LTV on qualifying refurbishment purchases, £50,000 to £5 million. Up to 100% of works costs funded, with value-after-works lending on heavier schemes.
On this page
The short version
- A refurbishment bridge funds the purchase and the works on a property that isn't mortgageable yet.
- How the works are classified (light, medium or heavy) sets your rate, LTV and how the money is released.
- Rates from 0.59% a month on light works. Heavy works typically run 0.75% to 1.5%.
- 75% to 90% LTV on purchases: 75% across most of the market, 85% with around four or five lenders, and 90% with a small number for light works released on day one.
- On heavier schemes, lenders can lend against the value after works (GDV), usually up to 65% to 70%, which often releases more.
- Exit by selling the improved property or refinancing onto a buy-to-let or commercial mortgage.
What is a refurbishment bridging loan?
A refurbishment bridging loan is short-term secured finance, typically for 1 to 24 months, used to buy or refinance a property that needs work, fund those works, and bridge the gap until you sell it or refinance onto a long-term mortgage. Money for the works is released on day one for light jobs, or in stages for heavier ones.
A mortgage lender wants a property that's habitable now. A missing kitchen, damp, an old roof or a building being reconfigured all rule that out. Refurbishment bridging lends on the property as it is and on what it will be worth when you've finished, so you can buy it, do the work and then move onto cheaper long-term finance.
It's also called a renovation bridging loan or a refurb bridge. They're the same product. What changes your terms is the works classification. For purely cosmetic projects, see light refurbishment bridging.
Light, medium or heavy: how your works are classified
This is the decision that sets everything else. Get the classification wrong and the case slows down or gets declined.
Light: cosmetic, non-structural
- Kitchens and bathrooms
- Redecoration and flooring
- Like-for-like windows
- EPC upgrades and insulation
Medium: extensive, non-structural
- Full rewire and new heating
- Re-roofing the covering
- Major damp remediation
- Moving non-load-bearing walls
Heavy: structural
- Extensions and loft conversions
- Underpinning and removing walls
- HMO conversions
- Works that need planning
| Light | Medium | Heavy | |
|---|---|---|---|
| Structural work | None | None or minor | Yes |
| Planning | Not needed | Rarely | Often |
| Rate | 0.59% to 1.0% pm | 0.69% to 1.25% pm | 0.75% to 1.5% pm |
| Max LTV | Up to 80%, 90% qualifying | 75% to 80% | Up to 75% |
| Valuation | AVM, desktop or RICS | Desktop or RICS | Usually full RICS |
| Works money | Day one | Day one or part-staged | Staged, 3 to 5 tranches |
| Monitoring | Minimal | Light-touch | Regular inspections |
| Completion | 3 to 10 working days | 5 to 15 working days | 10 to 20 working days |
A light refurb with a new boiler and a knocked-through kitchen drifts into medium. A medium job that touches a load-bearing wall becomes heavy. The classification a lender applies can move your rate from around 0.59% to 1.15% a month and your LTV from 80% to 70%. Send us the scope and we'll place it with the lender that classifies it most fairly.
How high can the day-one advance go? 75% to 90%
Between 75% and 90% LTV is achievable on refurbishment purchases. Where you land depends mainly on how the money is released, how heavy the works are and your credit.
| Day-one LTV | How available | Typical conditions |
|---|---|---|
| 75% | Most of the market | Light or heavy works. Often combined with 100% of the works funded in stages |
| 80% | A good number of lenders | All money released on day one, LTGDV capped around 70% to 75%, heavy works usually with planning in place from day one |
| 85% | Around four or five lenders | Light works, clean credit, a strong refinance exit |
| 90% | A small number of lenders | Light works, everything released on day one with no drawdowns, LTGDV capped at 70%, loans up to around £1m |
Two ways lenders structure it
Everything on day one, no drawdowns
The whole loan is released at completion, purchase and works money together, at up to 80% to 90% of value, capped at around 70% to 75% of the value after works. It's simplest and quickest, with no stage inspections, and it's where the highest day-one LTVs are.
Works funded in stages
Day one at up to 75% of value, then 100% of the works funded in arrears as each stage is signed off, within around 70% to 75% of GDV. It's better for heavier works, because the works money doesn't have to fit inside the day-one advance.
What it usually takes to get 80% or more on day one
- Residential property, often with maximum values for single houses and flats
- Light or medium works within the lender's cost limit. For heavy works, planning must be in place on day one
- The value after works supports it: the total stays within about 70% to 75% of GDV
- A refinance exit in most cases, though some products allow a sale
- A minimum loan size, often around £150,000 to £200,000 on the highest-LTV products
- Clean or near-clean credit
- Interest rolled up, with a schedule of works and quotes ready
Lenders offering the highest day-one advances may not support particularly heavy works, because the works money would be too large to release up front. Those schemes usually suit a staged product instead. Borrowers with adverse credit are unlikely to get very high net advances, and typically sit at 65% to 75%.
Refurbishment bridging rates and costs in 2026
Rates range from around 0.59% to 1.5% a month, depending on the LTV, how complex the works are, the property and how strong your exit is. A light refurbishment at 65% LTV on a standard house with a clear buy-to-let refinance prices near the bottom. A heavy structural conversion with planning dependencies sits near the top.
| Loan type | Rate | Max LTV | Arrangement fee | Works money |
|---|---|---|---|---|
| Light refurbishment | 0.59% to 1.0% pm | Up to 80%, 90% qualifying | From 1% | Day one |
| Heavy refurbishment | 0.75% to 1.5% pm | Up to 75% | 1.5% to 2% | Staged |
| Auction plus refurbishment | 0.59% to 1.2% pm | Up to 85% | From 1% | Hybrid |
| HMO conversion | 0.75% to 1.35% pm | Up to 75% | 1.5% to 2% | Staged |
| No-valuation refurbishment | 0.65% to 1.25% pm | Up to 70% | 1.5% to 2% | Day one |
Compare offers on the total cost to redemption, not the monthly rate. A lower rate with a 2% arrangement fee and a 1% exit fee is often dearer than a higher rate with neither. Budget for valuation and legal fees on top, typically £1,500 to £3,500 between them. There's no upfront broker fee: we're paid by the lender on completion, disclosed before you proceed.
Model your project
Enter the price, the works and the value after works. The calculator applies the right LTV and GDV limits for your works type.
How the money is released, and how interest works
Day-one advance
The whole loan, including the works money, is released on completion, with interest on the full amount from day one. It suits light works of 4 to 12 weeks with a clear, costed scope. There are no milestone inspections.
Staged drawdowns
Works money is released in stages as milestones are completed and checked, and you only pay interest on what's been drawn. It suits heavy works of 3 to 9 months or more, with photos or a monitoring surveyor at each stage.
Retained interest
The term's interest is deducted at the start, so there are no monthly payments. It's the default on refurbishment, as there's no rent during the works. A £300,000 loan at 0.59% for 12 months retains about £21,240.
Rolled-up interest
Interest is added to the balance and repaid at the end, so you get more cash on day one but a bigger final figure.
Serviced interest
You pay interest monthly and get the full advance. It's the cheapest overall, but needs income to pay it, so it suits portfolio landlords.
LTV vs GDV: how much lenders will advance
Two numbers decide your loan: what the property is worth today, and what it'll be worth when the works are done, its gross development value (GDV). Knowing which one your lender uses is the biggest factor in how much you can borrow.
LTV: today's value
Based on the current value or purchase price, whichever is lower. It caps the day-one advance, typically 75% to 80%, and up to 90% on qualifying light refurbishment purchases.
LTGDV: the value after works
Based on the RICS post-works valuation, covering the purchase and the works together. Typically capped at 65% to 70%, and 75% for experienced borrowers. It often releases more in total.
Worked example: same deal, two routes
A 3-bed semi bought for £250,000, needing £60,000 of works, valued at £395,000 afterwards.
| LTV-led (75% of £250,000) | GDV-led (70% of £395,000) | |
|---|---|---|
| Day-one purchase advance | £187,500 | £187,500 |
| Works funding | Only if the total stays inside the LTV | £60,000, released in stages |
| Maximum total facility | £187,500 | £276,500 |
| Your cash needed | £122,500 | £33,500 |
GDV-led lending isn't automatically better. It costs more in valuation and monitoring, takes longer and needs strong evidence. It wins where the works add much more than they cost, the works are large relative to the price, or the use changes, such as an HMO conversion.
What the valuer needs from you
- A costed, room-by-room schedule of works with contractor quotes
- Drawings or a floor plan of the finished layout, especially if walls move
- Three comparable sold prices for the finished specification nearby
- A realistic programme with milestone dates
- Planning consent or permitted development confirmation where needed
- Exit evidence: an agent's appraisal or indicative buy-to-let terms at the post-works value
Valuers test the GDV rather than just accept it. Expect it to come in 10% to 15% below your own estimate, and allow a contingency of 10% of the works cost. The loan is sized on the valuer's number, never yours.
Can you get 100% refurbishment finance?
Yes, but only with extra security. No lender advances 100% of a property's value against that property alone. What's possible is 100% of the purchase price, or price plus works, when you offer a second property as additional security.
For example, a £200,000 purchase needing £50,000 of works, with an unencumbered £180,000 property added, gives £380,000 of security against a £250,000 loan, around 66% across both, which prices normally. Expect a modest rate increase of about 0.10% to 0.25% a month and seven to ten extra days for the second valuation and legals. If the project fails, the lender can recover against the second property. Don't offer your own home without independent advice, as that may make the loan regulated.
Without a second property, the practical route to near-100% is a below-market purchase. Buy at £160,000 against a £200,000 value and 75% to 80% of value covers most or all of the price, which is why auctions and refurbishment finance go together so often. See auction bridging loans.
Refurbishment finance or development finance?
The dividing line isn't the budget. It's whether you're improving an existing building or creating new floor area and new units.
| Refurbishment finance | Development finance | |
|---|---|---|
| Scheme | An existing building improved | Ground-up, or new units created |
| Planning | Permitted development or none, for most works | Full planning needed |
| Lending basis | LTV, or LTGDV on heavy works | Land plus build costs, against GDV |
| Monitoring | Light or none on smaller works | A monitoring surveyor throughout |
| Term | 1 to 24 months | 12 to 36 months |
| Speed | 7 to 14 days typical | 4 to 8 weeks typical |
Creating units under permitted development? See permitted development finance. Part-built with a facility running out? A development exit is usually cheaper than extending.
When is refurbishment bridging used?
Unmortgageable purchases
Structural issues, no kitchen or bathroom, or serious damp. Buy, fix, then refinance.
Buy, refurbish, refinance
Buy below value, refurbish, then refinance onto a buy-to-let mortgage at the higher value and pull money out.
Flips
Buy, refurbish and sell within the term.
Auction purchases
Complete within the 28-day deadline, then do the works. See auction bridging.
HMO conversions
Fund the purchase and conversion, then exit onto an HMO mortgage. See HMO bridging.
EPC upgrades
Insulation, glazing and heating can be funded alongside cosmetic works. Cost them as a separate line in your schedule.
Already own the property? Second charge bridging can fund works without disturbing your mortgage. Want to skip the valuation wait? See no valuation bridging.
Who can get a refurbishment bridging loan?
Property
Residential and mixed-use in England, Scotland and Wales, including unmortgageable and auction property. Non-standard construction and ex-local authority flats case by case.
Loan
£50,000 to £5 million and above, 1 to 24 months, first or second charge.
Borrower
Individuals, limited companies and SPVs, including first-time investors with some lenders. Adverse credit is considered, typically at 65% to 70% LTV and a premium of about 0.2% to 0.4% a month. See bad credit bridging.
Works and exit
A detailed scope, contractor quotes for heavier works, a realistic programme, planning confirmed if needed, and an evidenced exit.
Can I renovate my own home with a bridging loan?
Yes, but it's regulated. A bridge is regulated where at least 40% of the property is, or will be, lived in by you or a close family member, which includes renovating your own home or a property you'll move into. Most refurbishment bridging is unregulated investment lending. Aura Capital arranges unregulated loans, and for regulated cases we arrange an independent FCA-authorised adviser at no cost to you. See regulated bridging.
How it works, and how fast
A well-prepared case typically completes in 7 to 14 days from enquiry to funds. AVM or desktop cases can take 3 to 7 days, heavy GDV-led schemes 14 to 28, and cross-charged cases 21 to 35. These are typical times, not guarantees. The four things that decide your timeline are whether a physical valuation is needed, whether your solicitor does bridging, whether your schedule is costed line by line, and whether your proof of funds is ready.
Enquiry and feasibility
Address, price or debt, works cost and scope, loan, term and exit. Feasibility and structure, usually the same day.
Decision in principle
Rate, LTV, day-one or staged funding, fee and timeline, matched across our whole-of-market panel.
Valuation
AVM or desktop in 0 to 2 days where eligible, or a full RICS in 3 to 5 days, confirming current and post-works value.
Offer, legals and completion
Your solicitor's speed is usually what sets the pace, so use one who does bridging. Funds are released on completion, with any later tranches tied to milestones.
Exit strategies
Refinance to buy-to-let
The most common exit. Show the post-works rent with local comparables, confirm the property will meet buy-to-let criteria, and allow for the six-month tenancy many lenders want. Rent usually needs to cover 125% to 145% of the mortgage payment.
Sale
Back it with comparable sold prices, an agent's appraisal and a realistic programme with a buffer.
Development exit or portfolio refinance
For larger schemes, a development exit bridge gives time to sell or let. Experienced investors may refinance across a portfolio.
Refurbishment bridging case studies
Light refurb to buy-to-let, Manchester
An unmortgageable 3-bed terrace bought below value for £220,000. £165,000 at 75% LTV and 0.89% a month as a day-one advance, with £25,000 of works covering the kitchen, bathroom, decoration, flooring and EPC. It was refinanced onto a buy-to-let mortgage at a £275,000 valuation after 4 months, creating £48,200 of equity after all costs, at £1,350 a month in rent.
£165,000, 75% LTV, 4 monthsAuction and extension, Birmingham
A neglected semi bought at auction for £185,000, with £55,000 of works including a rear extension, rewire and new kitchen and bathrooms. A £220,000 facility at 1.15% a month, released in three stages, completed in 9 working days. It sold for £340,000 within 7 months for a net profit of £79,800.
£220,000, staged, 9 working daysHMO conversion, Leeds
A standard house bought for £230,000 with £172,500 at 75% LTV, and £45,000 of works for en-suites, a shared kitchen and fire safety, funded in stages. It was refinanced at a £365,000 HMO valuation after 6 months, at £3,450 a month in rent.
£172,500, 75% LTV, 6 monthsRefurbishment bridging loan FAQs
What is a refurbishment bridging loan?
Short-term secured finance, usually 1 to 24 months, to buy or refinance a property that needs work, fund the works, and bridge the gap until you sell or refinance onto a long-term mortgage. Light works are funded on day one, and heavier works in stages.
What are refurbishment bridging rates in 2026?
From around 0.59% a month on light works with a strong exit and lower LTV, up to about 1.5% on heavy structural schemes. Medium works typically run 0.69% to 1.25%. The rate depends on LTV, the works, the property, the exit and your experience.
What is the maximum LTV on a refurbishment bridge?
Between 75% and 90%. Most of the market lends 75% on day one, around four or five lenders go to 85%, and a small number reach 90% for light works where everything is released on day one, capped at about 70% of the value after works. Heavier works usually suit 75% day one plus 100% of the works funded in stages.
What is the difference between light and heavy refurbishment?
Light refurbishment is non-structural, such as kitchens, bathrooms, decoration, flooring and EPC work. It's funded on day one at 0.59% to 1.0% a month. Heavy refurbishment is structural, such as extensions, lofts, wall removal and HMO conversions. It's funded in stages at 0.75% to 1.5%, usually up to 75% LTV.
What do I need to get 80% or more on day one?
Usually a residential property, light or medium works within the lender's cost limit (or planning in place for heavy works), a value after works that keeps the loan within about 70% to 75% of GDV, a refinance exit, clean credit and a minimum loan size, often £150,000 to £200,000. Everything is released on day one with no drawdowns.
Does a refurbishment bridge cover 100% of the works?
Usually, yes. Most specialist lenders fund up to 100% of the works, on day one for light jobs or in stages for heavier ones. The purchase is funded as a percentage of value, and the total is normally capped against the value after works.
Can I get 100% refurbishment finance?
Only with extra security. A lender can fund 100% of the price, or price and works, if you add a second property as security, so the loan is measured against both. Buying below market value is the other route.
How do lenders calculate GDV?
A RICS valuer assesses the open-market value of the finished property from your costed schedule, drawings and comparable sold prices. The lender then caps the total loan at typically 65% to 70% of that figure, or 75% for experienced borrowers.
How quickly can a refurbishment bridging loan complete?
Typically 7 to 14 days from enquiry to funds, and 3 to 7 days where an AVM or desktop valuation is accepted. Heavy GDV-led schemes take 14 to 28 days, and cross-charged cases 21 to 35. Your solicitor's speed is usually the deciding factor.
Is interest retained, rolled up or serviced?
All three are available, and retained is the default because there's usually no rent during the works. Retained interest is deducted at the start, rolled-up interest is added and repaid at the end, and serviced interest is paid monthly.
Do I need planning permission?
Not for most internal works such as kitchens, bathrooms, decoration and EPC upgrades. Extensions and lofts beyond permitted development, changes of use and external structural changes usually need planning. Some lenders accept pending planning.
Can I get refurbishment finance with bad credit?
Yes. Lenders focus on the property and the exit, so historic CCJs, defaults and discharged bankruptcy can be accepted, typically at 65% to 75% LTV and about 0.2% to 0.4% a month more. Very high day-one advances of 85% to 90% are unlikely with adverse credit.
Can I use a bridging loan to renovate my own home?
Yes, but it's a regulated loan, because you or your family will live there. We arrange an independent FCA-authorised adviser for regulated cases at no cost to you.
What is the difference between refurbishment finance and development finance?
Refurbishment finance improves an existing building, lends on LTV or GDV, and completes in 7 to 14 days. Development finance creates new floor area or new units, needs full planning and a monitoring surveyor, and takes 4 to 8 weeks.
Who wrote this page
Harry Baker
Harry holds an MSc in Real Estate & Finance from the University of Reading. He arranges light, medium and heavy refurbishment bridging across the UK, including GDV-led facilities and cross-charged structures.
- Team transacted
- £500m+
- Lender panel
- 50+
How we compiled the figures
Rates, LTVs and criteria reflect live terms across our whole-of-market lender panel and are reviewed monthly. Every case is priced individually.
Related bridging products
Each product page has its own criteria and rates.
Fund the purchase and the works
Send the address, price, works scope and cost, and your exit. We'll classify the works, compare the whole market and come back the same day with the right structure, before you commit to any costs. No upfront fees.
Your property may be repossessed if you do not keep up repayments on a loan secured on it. Refurbishment bridging is subject to valuation, underwriting, legal due diligence and exit assessment. Figures are indicative, based on our lender panel in October 2026. Aura Capital is a trading name of Chammosair Limited, registered in England & Wales, company no. 15786496. Aura Capital is an independent whole-of-market broker, not a lender, and is not authorised or regulated by the Financial Conduct Authority. We do not arrange regulated loans or give financial advice. On regulated cases we arrange an independent FCA-authorised adviser.