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Fast Fluid Finance

bridging finance May 10, 2019

This is how to create a flow of cash from one project to the next as seamlessly as possible.

Bridging finance is a smart solution in many situations – but not all bridgers work the same way.  You need a bridger who will lend on the property’s VALUE, not what you are actually paying.

When it’s time to refinance, you will need to to convince the lender’s surveyor of the uplifted value of your property.  The fact that the identical house next door is on the market for £200K won’t have much influence if you only paid £150K for your property six months ago.  Your job will be to alter the surveyor’s opinion of the actual value of the property.

Part of the process of buying to refurb is due diligence – don’t skimp on this and don’t guess.  Getting your calculations wrong can mean trapping much more cash in the property than you wanted.

These seven vital steps twill make refinancing your properties profitable and keep your cash moving.  To make it easy to remember these I’m using the acronym IMPROVE.


Get your smartphone out and start snapping the details.  From the moment you complete get detailed images of the condition of every room, with close-ups of the areas you’ll refurb.  Take more photos during the refurb process and more when the refurb is done, ideally from the same angles as the original pre-refurb shots.  Images are a powerful persuader.


Be present and go round the property with the lender’s surveyor every step of the way.  Brief them about everything that has been done, showing the pictures and the paperwork. 


If your refurb has included a conversion – for instance from a single residence to apartments or an HMO (with planning permission, of course) the valuer needs to understand this.  The price similar properties have actually been sold at will help to make your case.


The detailed work schedules for all refurbing need to be available.  The more detailed the better so the valuer can see the depth of the refurb.  Aim for the level of detail a quantity surveyor’s report would carry.


An empty house doesn’t make the same impact as a home with occupants.  If you have not yet got tenants, put temporary furnishing in to set the scene. 


Do your own survey with a qualified RICS surveyor before the lender’s surveyor visits.  This survey will be based on current value, irrespective of what you paid and can be a valuable part of the pack you present to the lender’s surveyor.


Your expectations and the valuer’s are going to be different.  This is particularly true when you have changed the purpose of the property.  If you have converted it to an HMO there is likely to be a big difference of opinion. 

Most commonly a lender’s surveyor’s default position is to value an HMO on a bricks and mortar basis, unless they see compelling reasons not to.  The lender is always going to look at how they can get their money back if you default?

You’ll need to make significant changes to ensure that the property is not just a normal family home with locks on the bedroom doors.  It will need alterations like ensuites (particularly in ground floor reception rooms) and kitchenettes in each room, smoke, fire and CO2 alarms, sprinkler system, emergency lighting and more all help to chance the fabric of the building

None of these seven steps are difficult, although some take a little time and require you to be well-organised, but there’s nothing wrong with that!  Being organised and having a strategy you follow for every purchase will simply ensure that you are in control of your property investment income and your bank balance will grow to be very healthy.


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