borrowing more than i need

sunnygal

we are thinking of buying a house with a similar value to the property we are
selling however it needs work doing on it
can we borrow £50k even though we only need £30k to cover the mortgage.
My income covers a mortgage of £50k and have already been told I can borrow
this amount of money.

Ashley3283

sunnygal wrote: »

we are thinking of buying a house with a similar value to the property we are
selling however it needs work doing on it
can we borrow £50k even though we only need £30k to cover the mortgage.
My income covers a mortgage of £50k and have already been told I can borrow
this amount of money.

Providing you wont have a Loan To Value (LTV) percentage of no more than 80% you should be able to release funds from the property. If the LTV would be more than 80% then you'd probably need a secured loan (From memory they lend upto 125% of property value)

Hope this helps

getmore4less

What LTV and salary are we looking at?

Don't forget the costs of selling/buying.

sunnygal

The house will cost 250,000. We only need to borrow £30k as we have a big enough deposit to put down from the sale of our existing home.

But we want to do some work to the property so would like another £20k to spend on it.

The bank have told us that we can borrow at least £50,000 + on a mortgage, which clearly we don't need but we want to know if we could borrow that extra £20k as a mortgage even though we don't technically 'need' it to cover the mortgage.

Hope this makes sense and thanks for the advice.

herbiesjp

All you do is simply put down less deposit and borrow the £50k

The portion of the deposit that you have not used in the purchase, can then be used to do the work.

Simple really.

dimbo61

Consider an offset mortgage !
That way you borrow the £50K and put £20K into the offset account saving you interest until you need to spend money on the building work