Lendus.

Bridging Loans for Renovation Projects

Fund the purchase and full refurbishment of a property in one facility. Whether you are flipping a tired Victorian terrace, converting a former pub into flats, or upgrading a dated family home to a high-end finish, a renovation bridging loan advances funds in tranches as the work progresses — so you are only paying interest on what you have drawn. Repay when the property sells or refinances at its improved value.

200+ UK lenders
2-minute application
No credit check to apply
FCA-regulated brokers

Rates

0.5% – 1.3%

per month

Typical Term

6-18 months

Max LTV

Up to 70%

Amount

£75k – £3m

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How it works

1

The lender values the property in its current condition (Day 1 value) and also considers its gross development value (GDV) on completion of the works, allowing them to structure a facility that covers purchase and build costs.

2

On day one, the purchase tranche is released. Renovation funds are held in reserve and drawn down in agreed stages as the work passes lender inspections, so interest only accrues on money actually drawn.

3

A monitoring surveyor (appointed by the lender) visits the site at each draw-down stage to confirm works are progressing to plan and to certify the next tranche.

4

At practical completion, you either sell the property at the improved GDV or refinance onto a buy-to-let or residential mortgage, using the proceeds to repay the bridge in full.

When to use this type of bridging

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Risks to consider

Important

  • Build cost overruns are the single biggest risk on renovation bridges; if your contractor quotes prove inaccurate or unforeseen structural issues emerge, you may exhaust your renovation reserve before works are complete.
  • If the completed property does not achieve the forecast GDV — because the market has moved or the finish is below spec — your refinance or sale proceeds may not fully repay the loan.
  • Delays in construction extend the bridging term and therefore the total interest cost, which directly reduces your profit margin on a flip or adds to your holding costs.

Market context

UK renovation and refurbishment bridging accounted for approximately 31% of all bridging completions in 2025 (ASTL). The average gross development uplift on a light-to-medium residential renovation in England and Wales is estimated at 18-25% above purchase price, with London and the South East producing higher margins. EPC regulatory changes driving the transition to band C or above have significantly increased demand for energy-efficiency-led renovation bridging in 2025-26.

Frequently asked questions

What is the difference between a renovation bridge and a heavy refurbishment bridging loan?
A light or standard renovation bridge typically funds cosmetic and moderate structural works — new kitchen and bathrooms, re-wiring, re-plumbing, and redecoration — where the property retains its current use class. A heavy refurbishment bridge funds more complex structural works such as extensions, loft conversions, or change of use applications. Heavy refurb products generally carry slightly higher rates and require more detailed cost schedules, planning consents, and professional project management.
How are renovation funds released during the project?
Renovation funds are held in a retained facility and released in tranches, typically at agreed project milestones. Before each draw-down, a monitoring surveyor appointed by the lender inspects the works and certifies that the previous stage is complete to the required standard. This protects both you and the lender, ensuring funds are only released against completed work. Draw-down requests are usually processed within 3-5 working days of a satisfactory inspection.
Can I include my renovation costs in the bridging loan?
Yes — the renovation reserve is structured within the bridging facility from the outset. Your lender will require a detailed schedule of works with contractor quotes before agreeing the facility. The total loan (purchase price plus renovation costs) must still fall within the agreed LTV against the GDV. Some lenders will also advance a proportion of the renovation budget day one if you have prior build experience and the works schedule is conservative.
Do I need planning permission before I can draw renovation funds?
For works that require planning permission — such as extensions, changes of use, or loft conversions — most lenders will want to see the consent in place before completing. Permitted development works (internal reconfiguration, like-for-like replacements) generally do not require consent. If you are purchasing a property with a pending planning application, some lenders will bridge the purchase and release the renovation reserve once consent is granted.
What is the maximum LTV on a renovation bridging loan?
Most lenders cap renovation bridges at 70% of the current open market value (Day 1 value), though some will lend against a blended figure that incorporates the post-renovation GDV. If the post-renovation GDV is significantly higher than the Day 1 value, an experienced lender may structure the facility to cover purchase plus full build costs within a 65-70% LTV of GDV. Having a proven track record of completed renovation projects helps you access more generous terms.

Related bridging loans

Refurbishment Auction Property Development Exit

Guides and resources

How Bridging Loans Work Bridging Loan Costs Bridging vs Mortgage Best Bridging Lenders Together Money Review

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