Re-mortgage for refurbishment loan

Remortgaging for Refurbishment Finance

A remortgage for refurbishment allows homeowners or landlords to fund renovation works by switching to a new mortgage product and releasing equity from their property. It is a cost-effective option where the property is already mortgageable and the refurbishment is planned rather than urgent.

How remortgaging for refurbishment works

The new lender assesses the property’s current market value. If sufficient equity exists, a lump sum can be released at completion and used to fund refurbishment works, without the need for short-term finance.

Maximum loan-to-value (LTV) limits

Typical maximum LTVs are:

• Residential properties: up to 95% LTV, subject to affordability, credit profile, and property condition.
• Buy-to-let properties: up to 85% LTV, with affordability assessed using rental income stress testing.
• These limits can vary by lender and may be reduced where works are extensive or affect habitability.

Key underwriting considerations

Lenders may request details of the proposed refurbishment, particularly where works materially increase the property’s size or value. Provided the property remains acceptable security at completion, remortgaging is usually lower cost than bridging or short-term finance.

When a remortgage is suitable

Remortgaging is best suited to non-urgent refurbishment projects where timing is flexible and long-term cost efficiency is a priority. It offers predictable repayments, longer terms, and lower interest rates under UK lending standards.