The product enables borrowers to draw funds in stages, rather than receiving the full loan amount on day one.
Available up to 75% net loan to value (LTV) and 70% loan to gross development value (LTGDV), the product offers loan sizes from £250,000 to £5m, with terms of up to 18 months.
It will serve property investors wanting more cost-effective and flexible refurbishment funding solutions.
Designed for larger projects
Borrowers can access works funding through staged drawdowns, with a minimum drawdown amount of £25,000 and work costs of up to £750,000 funded in arrears.
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The heavy refurbishment with drawdowns product aims to reduce overall borrowing costs and improve cash flow management during the refurbishment process.
Borrowers only pay interest on the funds they have actually drawn, rather than the full loan amount.
It was designed for larger projects where planning permission is required. This includes house-to-flat and flat-to-house conversions, as well as other substantial refurbishment projects.
The product is available at rates from 1.02% per month, with a 2% arrangement fee.
Anna Lewis, commercial director at Castle Trust Bank, said: “We’ve seen growing demand from brokers and property investors for funding solutions that provide greater flexibility and help improve the overall economics of refurbishment projects.
“As investors become increasingly focused on managing costs and protecting margins, staged drawdowns offer a practical way to reduce unnecessary interest costs by ensuring borrowers only pay for the funds they have actually used.
“Our heavy refurbishment with drawdowns product gives investors greater control over their cash flow and enables funding to be aligned with the pace of works on site.”
