Multi-Tranche Bridging Loan for a Residential Property Renovation

Positive Commercial Finance specialises in arranging Refurbishment Bridging Loans for landlords, property investors and developers across the UK. This case study shows how we helped two investors secure high-leverage funding to purchase and renovate a property with 98% purchase funding and 100% of the refurbishment costs covered.

The Challenge

Our clients had agreed to purchase a residential property with excellent potential, but it required extensive refurbishment before it could achieve its full market value.

To keep the project on budget and minimise construction risk, they appointed a local contractor under a fixed-price building contract.

The property was being purchased through a Special Purpose Vehicle (SPV) as the first project in what they hoped would become a long-term property investment business.

One of the clients was an experienced landlord with refurbishment experience, while the other was undertaking their first property project. Although this combination gave lenders confidence, the limited development experience within the SPV meant a fixed-price contract was required before finance could be approved.

The clients wanted a funding solution that would:

• Maximise the amount they could borrow for the purchase
• Fund the full cost of the refurbishment
• Minimise the amount of cash they needed to invest
• Allow them to sell the completed property and reinvest the profits into future projects

Our Solution

Positive Commercial Finance sourced a Refurbishment Bridging Loan that provided a highly leveraged funding package.

The lender advanced 98% of the purchase price by taking a first charge over the property being purchased and a second charge over another property owned by the clients.

To support the refurbishment, the lender also agreed to fund 100% of the build costs, releasing the money in two stages as the works progressed.

This flexible structure meant the clients could complete the purchase and carry out the refurbishment without tying up significant amounts of their own capital.

Most importantly, it gave them the confidence to complete their first investment project together and build a platform for future developments.

Deal Structure

• Day One Loan to Value (LTV): 70%
• Purchase Funding: 98% (supported by additional security)
• Refurbishment Costs: 100% funded in two staged drawdowns
• Loan to Gross Development Value (LTGDV): 60%
• Interest Rate: 0.76% per month (interest retained)
• Arrangement Fee: 1%
• Exit Fee: None
• Term: 12 months

The Outcome

The clients successfully purchased the property and secured funding for the entire refurbishment without needing to finance the build costs themselves.

The combination of high-leverage purchase finance and staged refurbishment funding allowed them to complete the project while preserving cash for future opportunities.

Once the renovation is complete, they plan to sell the property and reinvest the profits into their next project, helping them grow a long-term property investment portfolio.

This case study demonstrates how a Refurbishment Bridging Loan can help both experienced landlords and first-time property developers fund ambitious refurbishment projects with minimal upfront capital.