The range is available to individuals and limited companies
CHL Mortgages has launched a buy-to-let refurbishment product range which is designed to help landlords improve the energy rating of their rental stock and improve the general condition of the property.
The products offer the ability to release the costs of the refurbishment upon completion, without having to change product.
The refurbishment product range consists of three products: light refurbishment, cosmetic improvement, and EPC Improvement. The first two products are designed to increase the future asset or rental value of the property, with the latter a green mortgage option which is specifically designed to improve the energy efficiency of the property.
The range is available to individuals and limited companies and is applicable on standard buy-to-let properties, small houses in multiple occupation (HMO), and small multi-unit freehold blocks (MUFBs) with five-year fixed rates starting from 4.41%. Lending will be calculated on the pre-works value with a retention held based upon the post-works estimated valuation.
Read more: CHL Mortgages expands product suite.
The product range has a maximum 75% LTV – pre and post works, which means landlords can release more if the value of the property has increased post works. The maximum cost of work must not exceed 25% of the pre-work property value.
The light refurbishment product has been designed for works not requiring building regulation sign off and includes works that can be signed off under the Competent Person Scheme. Examples of the works under this product include installation of a replacement kitchen, replacement bathroom, replacement doors and windows, roof coverings, new hot water and heating systems, and rewiring.
The EPC improvement product is for landlords looking to improve the energy efficiency of their buy-to-let property to meet the UK government’s proposal for existing rented properties to have a minimum EPC rating of ‘C’ or higher from April 2025. Example of these works include installation or replacement of hot water and heating systems, new windows, new doors, and insulation improvements.
The cosmetic improvement product has been designed for properties requiring cosmetic and minor improvement or repairs works, allowing the landlord to improve the condition of the property. Examples of the works include: general painting, plastering and decorating, installation of replacement floor coverings, minor improvement works, and updating fixtures and fittings.
For all products, the refurbishment works must be completed within three months of completion of the initial advance and landlords must supply a detailed schedule of the proposed works at application.
“This product range has been designed and developed in line with feedback received from our intermediary partners and a growing number of their landlord clients who are looking for a product which offers a single, one-stop solution which removes uncertainty around funding refurbishment supported by a simple process,” Ross Turrell (pictured), commercial director at CHL Mortgages, said.
“This alternative green mortgage product is more than a simple pricing play and provides an additional and viable option to alternative forms of finance such as bridging and refurb in term solutions while helping to reduce administrative burdens and save on multiple inspection and legal fees.”
Turrell added that CHL Mortgages’ BDM team will play a key role in supporting intermediary partners to help them explain the options the mortgage lender can now provide that will make a difference for landlord clients.
