Loan options for financing property renovation

  • Renovation loan rates from 0.55% per month
  • Maximum loan to value 75%
  • Access to funds from 2 working weeks
  • Same day lender decision in principle
  • Terms up to 24 months
  • No minimum term options
  • Usually no exit penalties
  • Switch to long-term finance

Quick turnaround times

We can provide short term finance and bridging loans specifically designed to fund your development or renovation projects, however big or small.

With a fast turnaround, you can receive funds within a matter of days, and then in stages throughout the project.

This keeps the costs down as the interest is only payable on the funds you receive.

Renovation finance can cover the costs of:

  • Restoration
  • Extension
  • Renovation
  • Construction 

Giving you the flexibility and time to complete work successfully.

Reasons to use renovation finance

Renovation finance can be used for a range of purposes including:

  • industrial units
  • housing developments
  • residential property
  • derelict houses
  • retail parks and developments
  • office blocks, hotels and care homes
  • conversions of pubs
  • business refits
  • land development
  • agricultural development
  • conversions of industrial premises
  • conversions into flats or other dwellings
  • modernising property
  • refurbishment of offices, flats, shops and restaurants
  • construction of commercial property

Researching property renovation projects 

Make sure you do your research on property you are interested in by checking out the local area and comparing property prices.

It’s also a good idea to arrange local searches and check any legal documents with a conveyancer so you know exactly what you’re buying. Look into the average length of local listings.

If nearby properties have been on the market for a while, demand is likely low, possibly meaning that near-term prospects for capital growth are poor.

Contingency fund

You should also have a contingency fund – renovation projects can, and frequently do, cost more than you think.

Between 10 and 15% of the total cost (purchase plus the assumed cost of work) is a good amount to have set aside.

Fund in stages

It is also possible to fund the project in stages; once the property is habitable, for instance, you could use a mortgage to repay the bridging loan you used to finance the purchase initially.

Boundaries and planning permission

Land registry and planning history searches are of particular importance, if you are planning to renovate. You will need to know the exact boundaries of the land and what modifications will require planning permission.

For more information on applying online visit the Government’s Planning Portal.

Negotiating the price

Consider having a full  survey done and obtain estimates from trades such as builders, electricians, plumbers and roofers.

This will give you an idea of the renovation cost.

It is crucial that this amount is not more than you will gain in added value. Factor in your contingency fund.

If costs are higher than expected, you may be able to negotiate the price down to ensure the project is viable.

UK building regulations

Restructuring work will need to comply with current building regulations. Be sure to factor the cost of compliance into your estimates.

How to find the right contractor

To help avoid rogue builders or contractors, make sure they are a member of the Federation of Master Builders.

Get quotes from at least three companies so you can compare services and fees. You need to be absolutely clear on what they offer as well as the level of responsibility they are willing to take on.

Request references and ask to see a portfolio of previous work to check they have appropriate experience.

In the UK, the Civil Engineering Contractors Association founded the Construction Alliance, which comprises the following three federations who offer various services when it comes to finding a builder in your local area:

  1. The Civil Engineering Contractors Association (CECA)
  2. The Scottish Building Federation (SBF)
  3. The National Federation of Builders (NFB)

The National Federation of Builders has been in operation since 1896 and is a not-for-profit organisation serving England and Wales. The NFB supports small- to medium-sized building contractors and you can search their member database to find a builder in your local area.

Renovating uninhabitable property

In order to qualify as uninhabitable a property will be in need of either “structural alterations” or “major repair work”. A summary of what each might constitute is below, but largely this refers to unsound foundations, walls, floors, ceilings or roofs.

A property is uninhabitable if it is subject to one or more of the following types of structural problem:

  • No functioning kitchen
  • No functioning bathroom
  • Structurally unsound/unsafe roof
  • Chimney needs to be rebuilt
  • External walls need to be rebuilt
  • Significant work is being done to the property foundations
  • Solid floors or ceiling/floor joists need replacement
  • Internal walls need to be rebuilt

Major repair work

A property is uninhabitable if it is in need of the following major repair work:

  • Gutting the property
  • Removal of all plaster from walls
  • Taking down the majority of the ceilings
  • Removing timber walls
  • Installing new water tanks
  • Installing new damp proofing

Why choose us?

Commercial Trust is an specialist broker with expertise in short term bridging loans which are well suited to providing property renovation finance.