Loft Coversion needed ....equity question?

ELIZA_D

Hi there i live in a 2 bed terraced house and am having my second child in November.I have been self employed for a year and cannot afford to move house and so think the cheapest way of getting a third bedroom is upwards!
Im confused about what to do and thought i would ask here before i make an idiot of myself in front of my lender? I bought my house for 42 grand about 8 years ago and it is now worth 135,000.Should i have a loan or take out equity.....not that i understand what taking out equity means ive heard it said! Should i remortgage? So many questions so little time........where do i start? (Have read the remortgage guide) Thanks all XX

MortgageMamma

You need to remortgage to release some equity from your property. This is a fairly simple process and means moving your mortgage to a new lender or getting a better deal from your existing lender. The first port of call should be you existing lender. Give them a call and discuss your requirements, they will take details of your earnings and any credit you have to work out the maximum you will be able to borrow from them. They should give you something called a key facts documents which details all the charges and terms of the new mortgage they are offering you. Keep hold of this as you need it to compare other mortgages to.

The next step, before agreeing anything with your current lender, is to speak to a whole of market mortgage broker. Whole of market means the advisor has access to every single mortgage deal in the UK. This opens up your options tremendously. As your advisor to find the best deal for you, and again you will be given another key facts document to look at. Ask your advisor to compare your lenders offer with the other mortgage he/she thinks is suitable to the explain why it is a better mortgage.

Once you have decided which to go for you will need to fill out an application form and send it to the lender. In most cases basic legal work is covered free with a remortgage, as is your valuation fee (survey). The process can take as little as two weeks or much long dependent upon if its straightforward.

Just a note before you delve into this, you need to get planning permission for your loft conversion. Give the planning department at your local council a call and they will assist you in this respect.

Good luck and if you want anymore help give me a shout.

MM

ELIZA_D

Thankyou MM ! Will get on to this in the next couple of days when i get a spare min or three! x