Refurbishment mortgages

A refurbishment mortgage is a specialist mortgage for properties that need renovation or improvement work. The lender provides funding in stages as the work progresses, reducing risk and ensuring the project stays on track.

Refurbishment finance is available for various projects including kitchen and bathroom renovations, structural work, extensions, and complete property overhauls. The specific criteria and terms vary depending on the project type and complexity.

Staged funding means the lender releases funds in stages as the refurbishment progresses, typically based on completion milestones like structural work, first fix, second fix, and completion. This reduces risk for the lender and ensures the project stays on track.

Refurbishment mortgages typically require deposits of 30-35% of the total project cost, including purchase price and refurbishment costs. The exact amount depends on the project type, your experience, and the lender's criteria.

You'll need planning permission for any structural changes or extensions. For internal refurbishment work, you may not need planning permission, but you'll need building regulations approval for certain types of work.

Refurbishment finance is available for various property types, though the criteria may vary. The property must be suitable for refurbishment and have realistic potential for value increase after the work is completed.

Most lenders prefer borrowers with previous refurbishment experience, though some may consider applications from those with relevant construction backgrounds and strong professional teams.

Refurbishment projects typically take 3-12 months, depending on the scope of work. The mortgage term will be based on the expected completion date and your ability to service the debt.

Yes, refurbishment finance is available for properties you plan to live in, though you'll need to demonstrate your intention to reside in the property and may need to provide evidence of your plans.

If the refurbishment goes over budget, you may need to provide additional funds or renegotiate the loan terms. It's important to have contingency funds and realistic budget planning to avoid complications.