Additional Borrowing from a New Lender

LRK

I have existing mortgage with C&G at fab tracker rate and want to borrow an additional amount to build an extension. The current rates offered by C&G for additional homeloans are high and I want to know if its possible to borrow an additional amount with a new lender without having to transfer my existing mortgage from C&G. I've called a few lenders and they insist on you having all mortgages with them. Do any lenders not have this stipulation and offer good rates? I currently have a tracker mortgage .29% above BEBR..
Grateful for advice..

luckyfool

A loan secured against a house as the 1st charge is a mortgage. If it is secured 2nd/3rd/4th behind the mortgage then it is no longer a mortgage, it's a secured loan. You will not get a mortgage rate on the 2nd loan, but a secured loan rate which is likely to be 8%+. You are almost certainly going to get a much better rate on a further advance from C&G.

LRK

Thanks for the quick response. We've got a load of equity in the house and currently have 3 sub accounts against the house - all of which are mortgages. C&G have quoted a tracker rate for the additional borrowing of 5.29% (overall borrowing against the property will be 70%LTV with the additional borrowing)... I was wondering if another lender would offer a better rate and if they would lend to us at all if we did not have all borrowing against the house with them..?

luckyfool

As per my first response, no. The key term here is that they are all sub accounts with C&G, i.e. under the one main account and secured by one charge against your property. Any new lender coming in behind C&G would be as a 2nd charge and would charge a rate accordingly (8-15%+). You either take the further advance rate from C&G or move the whole lot to a new lender. An additional secured loan from a different bank is just going to be much more expensive.

LRK

Thanks - I understand what you were initially trying to convey now! C&G it is then..thanks again

dimbo61

As Martin might say do you really need to borrow more money to build an extension ! ( new kitchen !! NO ) ( extra bedroom/ loft conversion MAYBE )
Will it add value to your home and be of use to you and your family in the mean time.
Will the new bigger mortgage put you into a worse financial situation and can you afford it ?
Have you got an emergency pot of 3/6/9 months of income for when the S--t hits the fan so to speak ?
Consider when your existing deal ends and what will the LTV be of your home then ( Drive by valuations ) not good if you have a £50,000 extension on the back of your house !!!