A refurbishment bridging loan funds property improvement works where the scope, timeline, or current condition of the property makes a conventional mortgage either unavailable or impractical. Bridging lenders divide refurbishment into two categories — light and heavy — and those categories determine the LTV limit, the rate, and which part of the lender panel you can access.

This article explains what each category covers, how they are priced, what lenders need to see before they proceed, and how staged release (draws) works on larger projects.

Light Refurbishment vs Heavy Refurbishment — Where the Line Is Drawn

In bridging finance, the light/heavy distinction is not about cost or effort — it is about structural change, planning permission, and change of use.

Light refurbishment

Internal works that do not require planning permission or building regulations sign-off
Typical scope: kitchen and bathroom replacements, redecoration, flooring, damp treatment, minor electrics and plumbing
The property is habitable (or marginally uninhabitable) throughout
Exit: sale at improved value, or refinance onto a buy-to-let or residential mortgage
Lender appetite: most mainstream bridging lenders; competitive pricing

Heavy refurbishment

Works that require planning permission, building regulations approval, or involve structural changes
Typical scope: extensions, loft conversions with dormer or hip-to-gable, change of use (commercial to residential, HMO conversion), basement excavation, structural wall removal, complete roof replacement
The property is typically uninhabitable during works
Exit: sale at GDV (common), or refinance once works are certified and the property is mortgageable
Lender appetite: a narrower specialist panel; higher rate premium; staged draws common

The practical rule: if you are adding square footage, changing the roof structure, converting a floor plate, or moving structural walls, you are in heavy refurbishment regardless of what the builder quotes. Lenders confirm this with their valuer — not with the borrower’s description of the works.

Refurbishment Bridging Rates — What to Expect in 2026

Refurbishment bridging is priced at a premium over standard residential bridging because the exit depends on works completing — the security is not in standard condition, and the lender carries additional risk while works are in progress. Valuation is also more involved: most lenders instruct both an as-is value and a GDV (gross development value) report.

Type	LTV (as-is)	Indicative rate range
Light refurbishment	up to 70–75%	0.60–0.80% pm
Heavy refurbishment	up to 65–70%	0.75–1.00% pm

LTV for refurbishment bridging is typically calculated on the as-is value (the property in its current state), not the GDV. Some lenders — particularly on larger heavy-refurb cases — will lend against a blended as-is/GDV figure once the valuation is in hand. This is case-specific and requires a formal GDV report instructed by the lender.

At 70%+ LTV on heavy refurb cases, the lender panel narrows significantly. Above 75% as-is LTV on any refurb case, specialist lenders only.

For live rates including refurbishment products: rates page.

What Lenders Need for a Refurbishment Bridge

For light refurbishment

A clear schedule of works confirming the scope — not a building regs application, but enough detail for the lender’s valuer to confirm the works are cosmetic
A realistic timeline — light refurb works should complete within 3–6 months; lenders are cautious about light refurb bridges extending beyond 6 months because scope tends to drift
An exit plan based on the property at its improved value — most commonly a BTL remortgage or a sale; comparables at the improved value help

For heavy refurbishment

Planning permission granted (some lenders will proceed on a conditional basis pending planning — confirm before instructing, as this narrows the panel significantly)
Building regulations sign-off plan — the lender’s valuer checks against approved drawings
A fixed-price or schedule-of-works contract with a named, insured contractor — lenders are significantly more comfortable with a contracted and insured main contractor than a borrower managing individual trades
A realistic construction timeline — heavy refurb bridges are typically 6–18 months
A GDV report from the lender’s RICS surveyor — this is the reference value for the exit arithmetic
A confirmed exit: sale requires comparables at or near GDV; refinance requires an Agreement in Principle from a named receiving lender at a rate the borrower can sustain

For the four tests lenders apply to every exit (including refurb exits): bridging loan exit strategies.

Staged Release (Draws) — How It Works and What It Means for Your Project

Some heavy-refurb lenders release the finance in stages rather than as a single advance: an initial draw at loan start, then further tranches released on surveyor sign-off at agreed build milestones (typically “structure complete”, “first fix”, “second fix and ready for occupation”).

Why lenders use draws

Releasing the full loan on day one against an uninhabitable property means the lender’s security is at its weakest at the point of maximum exposure. Draws tie the loan balance to the build progress, so the property value — and thus the lender’s coverage — rises in step with the loan.

What it means for the borrower

You cannot draw the next tranche until the surveyor has inspected and signed off the previous stage — which typically takes 5–10 working days per milestone
You need to fund works between tranches from your own resources or a bridging facility that allows interim draws
Contractor payment terms must align with your draw schedule — a contractor on monthly payments while you are on milestone draws creates a cash-flow gap

For speed-critical projects: confirm upfront whether the lender releases as a single advance or in draws. Single-advance lenders exist but carry higher rates (they are accepting the full day-one exposure). A lender’s draw schedule is not always negotiable — agree it before instructing.

What a Refurbishment Bridge Actually Costs

The calculator will run the full numbers for your case. The worked examples below show the cost structure for each refurbishment type.

Light refurbishment — worked example

£180,000 light refurb bridge, property value £250,000 as-is (72% LTV), target improved value £320,000, 5-month term, BTL remortgage exit.

Cost item	Basis	Amount
Arrangement fee (1.5%)	1.5% × £180,000	£2,700
Interest (0.70% pm, retained, 5 months)	0.70% × £180,000 × 5	£6,300
RICS valuation	Estimate	£500
Lender legal costs	Estimate	£1,200
Broker fee (1%)	1% × £180,000	£1,800
Total cost of borrowing		£12,500
Net advance (after retained items)	£180,000 − £2,700 − £6,300	£171,000

Heavy refurbishment — worked example

£260,000 heavy refurb bridge (65% LTV), property value £400,000 as-is, GDV £620,000 (planning granted, loft conversion + rear extension), 12-month term, sale exit.

Cost item	Basis	Amount
Arrangement fee (1.5%)	1.5% × £260,000	£3,900
Interest (0.85% pm, retained, 12 months)	0.85% × £260,000 × 12	£26,520
RICS valuation + GDV report	Estimate	£1,500
Lender legal costs	Estimate	£2,000
Broker fee (1%)	1% × £260,000	£2,600
Total cost of borrowing		£36,520
Net advance (after retained items)	£260,000 − £3,900 − £26,520	£229,580

On the heavy refurb example above, the total cost of borrowing is 14% of the gross loan over 12 months. Against a GDV uplift of £220,000 (£620k minus £400k), the finance cost is well within the margin — but only if the project stays on timeline. A 3-month overrun at 0.85% pm on £260,000 adds £6,630 in additional interest alone.

For the full cost mechanics (retained vs rolled, arrangement fee vs exit fee): bridging loan costs explained.

What to Do Next

Check live rates for light and heavy refurbishment products: rates page
Run the numbers on your case (loan size, LTV, term): calculator
Discuss your refurbishment project with the panel: arrange a call

Refurbishment Bridging Loans: Light, Heavy and Everything in Between