Bridging finance is often associated with auctions and chain breaks, but a large share of short-term loans fund refurbishment. The type of works planned – light cosmetic updating or a heavy structural project – shapes the product, the leverage and the exit. Choosing the wrong category is one of the most common reasons a refurbishment bridge costs more or takes longer than planned.
Where the works go beyond heavy refurbishment into structural alteration, extension or ground-up construction, lenders usually move the case onto development finance, with funds released in stages against a monitoring surveyor’s sign-off.
Light refurbishment bridging
Light refurbishment typically covers works that do not alter the structure or the footprint: new kitchens and bathrooms, redecoration, flooring, rewiring and replacing windows. Lenders will often advance against the property in its current state with limited extra documentation, and some release funds for the works in stages or leave the borrower to fund them. The property usually remains habitable or can be made so quickly, and the exit is commonly a sale or refinance onto a term buy-to-let mortgage.
Heavy refurbishment and conversion bridging
Heavy refurbishment includes structural alterations, extensions, loft conversions, changing the number of units or changing the use of a building. These cases need more underwriting: planning or permitted-development evidence, a schedule of works, costings and often a monitoring surveyor. Funds for the works are usually released in tranches against inspected progress. Where the project becomes a ground-up build or large conversion, development funding may be more suitable – see our guides to development finance for Class MA conversions and ground-up development loans.
What lenders look at
- Loan-to-value and loan-to-gross-development-value. Lenders consider the current value and, for heavy projects, the expected value after works, and apply a cap to each.
- Experience. A track record of similar projects can support better terms; first-time developers may be offered lower leverage.
- Budget and contingency. Realistic costings with a sensible contingency are viewed more favourably than optimistic figures.
- The exit. Lenders want a credible, evidenced route to repayment, whether sale or refinance. Our guide to bridging loan exit strategies sets out what they expect to see.
Costs and timing
With Bank Rate at 3.75% following the September 2026 Monetary Policy Committee decision, bridging pricing is set by individual lenders and varies with leverage, security and exit strength. Bridging is typically priced monthly, with arrangement, valuation and legal fees on top, so total cost depends heavily on how long the project actually runs. Build in time for delays in works, planning or sales.
Planning the refinance early
If the exit is a refinance, check at the outset that the finished property will meet term-lender criteria, including EPC, lease length for flats and tenancy requirements. Speak to your broker before works begin rather than after.
Next steps
Find out how we arrange short-term funding on our bridging finance page, browse related guides in the Bridging & Development Finance Hub, or contact Giles Finance to discuss your project. If your property is in the Putney area, see our Putney office page.
Bridging finance is typically unregulated lending, although some bridging loans secured on a property you live in, or intend to live in, may be regulated. Your property may be repossessed if you do not keep up repayments on a loan secured against it.
Giles Finance is a trading style of Giles Finance & Consultancy Services, authorised and regulated by the Financial Conduct Authority (FRN 726857).