Refurbishment Loan Calculator: Running the Numbers Before You Apply in 2026

There is a spreadsheet open at half past eleven at night with one cell highlighted in green. It says 61,000 pounds, and it is the profit on a two bed end terrace in Rotherham once the kitchen is in and the tenant is paying. The cell is wrong. It has subtracted the purchase price and the builder’s quote from the end value and stopped there. It has not subtracted twelve months of interest on money that is drawn on day one, or the arrangement fee that comes off the advance before the solicitor sees it, or the two valuations, or the three months after the last coat of paint when the property sits empty waiting for a refinance. Put those in and the green cell loses more than ten thousand pounds. That is the gap a refurbishment loan calculator exists to close, and it is worth closing before an offer is made rather than after.

Refurbishment Loan, a trading name of Lenzie Consulting Ltd (company number 08174104), is a UK finance arranger and introducer, not a lender. Bridging and refurbishment finance secured on investment property is unregulated lending that falls outside the Financial Conduct Authority’s regulated mortgage perimeter, and the business holds no FCA authorisation because the products it arranges are unregulated. It does not arrange regulated bridging, residential mortgages, or any loan secured on a property the borrower or an immediate family member lives in or intends to live in; those enquiries are referred to a regulated firm. Every figure below is an indicative range, confirmed only in a formal offer, never on a website.

In the episode below, Georgina takes a project through the same arithmetic line by line and points out where the numbers usually break.

The two inputs no calculator can guess

Every calculation on this page hangs off two figures, and both are yours to get right.

The first is the works budget. Not the builder’s verbal estimate, but a written schedule of works priced trade by trade, with a contingency on top. Ten percent is the usual contingency on cosmetic work and fifteen on anything that involves opening up a structure, because that is where the surprises live.

The second is the end value. Not what you hope the property is worth finished, but what a surveyor will sign off using comparable sales of similar finished properties within a sensible radius and a recent time window. Optimism in this cell is the single most common reason a project that modelled well comes up short, because it inflates the exit and therefore the amount you assumed you could refinance.

Take the Rotherham terrace as the worked project: purchase price 165,000 pounds, works budget 45,000 pounds covering a kitchen, a bathroom, a rewire, replastering, a boiler and windows, none of it structural. Term twelve months. End value supported by comparables at 285,000 pounds.

Step one: the day one advance

On a light refurbishment the day one advance is a percentage of the purchase price, capped at 75 percent, and on this project the lender offers 72 percent.

165,000 at 72 percent is 118,800 pounds. The deposit is therefore 46,200 pounds of your own cash, before any fee or tax.

Heavy schemes work differently and it matters. There the whole facility, advance plus works plus costs, is tested against 75 percent of gross development value rather than against the purchase price. On the same property with an end value of 285,000 pounds, 75 percent of gross development value is 213,750 pounds, which is a far larger ceiling than 75 percent of the purchase price. That single change of basis is why the classification of the work as light or heavy is the first question a lender asks and the first input a calculator needs.

Step two: the works facility

The works budget of 45,000 pounds is a separate limit alongside the advance. Total facility 163,800 pounds.

On light work the lender will fund up to 100 percent of the schedule, released in arrears. In practice that means you pay the trades, the lender sends a valuer or accepts photographs and invoices, and the money is reimbursed a week or so later. You are cash flowing each stage yourself for that week, which is a working capital requirement the calculator will not show you.

On heavy work the money is released in staged drawdowns against a quantity surveyor or monitoring surveyor certifying the work in place. That is slower and adds a fee of several hundred pounds per visit, and it is not optional above a certain size of scheme.

Step three: the interest, retained or rolled

Assume 0.89 percent a month, which sits mid band for light work. Interest is charged only on money actually drawn, which is why the works tranches cost less than the day one advance even though the limit is agreed on day one.

The day one advance of 118,800 pounds at 0.89 percent is 1,057.32 pounds a month. Across twelve months that is 12,688 pounds.

The works come in three tranches of 15,000 pounds at months two, four and six. Each tranche costs 133.50 pounds a month. The first runs for ten months at 1,335 pounds, the second for eight at 1,068 pounds, the third for six at 801 pounds. Works interest totals 3,204 pounds. Interest across the facility is 15,892 pounds.

Retained means the lender deducts that 15,892 pounds from the advance at the outset and you make no monthly payment. Rolled means it accrues onto the balance and compounds. Compounding at 0.89 percent a month for twelve months costs 13,328 pounds on the day one advance rather than 12,688 pounds, so rolling is 640 pounds more expensive but leaves the retained sum in your pocket on completion day. On a project where the works cash flow is tight, that trade is usually worth making.

Step four: the fees, which are not a rounding error

The lender arrangement fee runs at 1.5 to 2 percent of the total facility and comes out of the advance rather than arriving as a separate bill. At 1.75 percent of 163,800 pounds it is 2,867 pounds.

Add the valuation at 750 pounds, the lender’s legal costs at 1,200 pounds and your own solicitor at 1,500 pounds, so 3,450 pounds of transaction costs.

The cost of the money over twelve months is therefore 15,892 plus 2,867 plus 3,450, which is 22,209 pounds. Not in that figure, and not in any calculator on any finance website: stamp duty at the additional property rates, the exit lender’s own fees, buildings insurance on an unoccupied property, council tax on an empty dwelling, and the holding cost of the weeks between practical completion and a tenant moving in.

Step five: the exit and what is left

The refinance is what repays everything, so it is the number that has to be stress tested hardest.

A refurbishment mortgage at 75 percent of the 285,000 pound end value produces 213,750 pounds. That redeems the 163,800 pound facility and leaves 49,950 pounds. The equity gain across the project, after purchase, works and every finance cost, is 52,791 pounds.

Now stress it. Drop the end value by ten percent to 256,500 pounds and the refinance produces 192,375 pounds. It still clears the facility comfortably, which is the test that matters. Drop it by twenty percent and the margin starts to look thin. A project that survives a ten percent haircut on end value and three extra months on the term is a project worth submitting.

Line	Amount
Purchase price	165,000 pounds
Day one advance at 72 percent	118,800 pounds
Cash deposit	46,200 pounds
Works facility	45,000 pounds
Total facility	163,800 pounds
Interest, 12 months, retained	15,892 pounds
Arrangement fee at 1.75 percent	2,867 pounds
Valuation and legal costs	3,450 pounds
Total cost of the money	22,209 pounds
End value	285,000 pounds
Refinance at 75 percent	213,750 pounds
Surplus after redemption	49,950 pounds

What a lender checks that no calculator can

A calculator prices the money. It cannot price the schedule of works, the valuer’s view of your end value, or whether the exit is real.

Four things decide the case once the arithmetic is agreed, and none of them has an input box.

Whether the work is light or heavy. You may have entered light. If the schedule moves a load bearing wall, changes the use, or needs planning or building regulations sign off, the underwriter reclassifies it, the leverage basis changes from loan to value to loan to gross development value, the rate moves into the 0.85 to 1.15 percent band, and a surveyor joins the project.

Your track record. A first project with a 45,000 pound schedule reads differently from a fifth. Experience does not change the arithmetic but it changes the appetite, the leverage offered and sometimes the rate.

The comparables behind the end value. The valuer’s figure, not yours, sizes the exit. Weak comparables are the most common reason a modelled deal comes back smaller than expected.

Whether the exit lender exists. An assumed refinance is not an exit. Underwriters increasingly want the refinance evidenced at the outset, with a broker’s illustration or an agreement in principle from a term lender on the file before the bridge completes.

The 2026 outlook

The Bank of England held base rate at 3.75 percent at the July 2026 decision, and monthly pricing on short dated property finance has been stable through the year rather than repricing quarter by quarter. That stability is what makes a twelve month calculation worth doing at all, because an input that moves underneath you halfway through the term is not a plan.

The lender panel we place these projects with is currently quoting 0.75 to 0.99 percent a month on light schemes and 0.85 to 1.15 percent on heavy, with arrangement fees at 1.5 to 2 percent and facilities from 75,000 to 5 million pounds. Search interest in the tool itself is small but very commercial: refurbishment loan calculator draws about 20 UK queries a month at a cost per click above 40 pounds, which tells you the people typing it are usually about to transact.

FAQ

Is a refurbishment loan calculator accurate enough to budget from? It is accurate on the cost of the money and unreliable on everything else, because the two inputs that drive the outcome, the works budget and the end value, are estimates you supply. Treat the output as a first pass that tells you whether a project is worth pricing properly, not as a quote.

Should I model rolled or retained interest? Model both. Retained is cheaper because it does not compound, but it reduces the cash released on completion day, which means finding more of the purchase price yourself. Rolled costs more, 640 pounds more over twelve months on the project above, and leaves that cash available for the works. The right answer depends on which constraint binds.

Why does the calculation need an end value rather than just a purchase price? Because the end value sizes your exit and, on heavy schemes, sizes the facility itself. Light work is advanced against the purchase price, but heavy work is tested against 75 percent of gross development value, so the end value is an input to the loan, not only to the profit.

How much cash do I actually need for a refurbishment project? More than the deposit. On the worked project it is 46,200 pounds of deposit, plus stamp duty, plus the fees not taken from the advance, plus enough working capital to pay each stage of the works before the lender reimburses it in arrears. Budget for the gap between paying the builder and being repaid.

Talk to us

Run your project through the refurbishment loan calculator, then send us the same four numbers and we will convert them into indicative terms from the panel, usually the same working day. If you are still deciding how the project should be funded, our overview of property refurbishment finance covers the routes, and refurbishment bridging loans covers the mechanics of drawdown and exit. See also the guide to refurbishment loan costs for the fee by fee breakdown behind the total above.

All figures in this article are indicative ranges for UK refurbishment finance in 2026, confirmed only in a formal offer, and are not an offer, a quote or a financial promotion. Any facility is subject to lender terms, valuation and full underwriting. This article was written by Matt Lenzie.