Further Advance - Loan required- help?

getmore4less

AJAX123 wrote: »

Thanks for your suggestion not prepared to pay such a high rate of interest just not worth it! We have other options i.e knocking down the house and rebuilding so shall now look into that route.........Its a journey, thought we were at the end, it appear not.....thanks anyway

SO £150k cash + £70k at 17% to make £700k is not worth it.

why not? the interest is small change as you won't need most of the money till near the end of the project so will not be paying interest for that long


Knocking down and rebuilding where are you going to get the money for that?

AJAX123_2

SandC wrote: »

You were the ones who got the sums wrong for the renovations, not the lender!

That is untrue - we were basing the figures upon those provided to us by so called experts within the building industry. Like everything it is not an exact science though we were naive in thinking we could expect support from the financial provider to take into account any differences of between 10 - 20%. We are not experts just normal ever day people trying to build a home at a realistic cost and to protect our investment. This is not for re-sale for profit! You appear to more the expert, what would your solution to this be?

AJAX123_2

getmore4less wrote: »

SO £150k cash + £70k at 17% to make £700k is not worth it.

why not? the interest is small change as you won't need most of the money till near the end of the project so will not be paying interest for that long


Knocking down and rebuilding where are you going to get the money for that?

Knocking down and and re-building gives the option of two plots - two houses. There is always more than one way to skin a cat it is just finding the right way - once again thanks for the help

Conrad

Most developers I deal with make around 15% profit on a deal. Yours is an exceptional deal - surpising other developers (that all EA's keep details of) were'nt all over this property.

SandC

AJAX123 wrote: »

That is untrue - we were basing the figures upon those provided to us by so called experts within the building industry. Like everything it is not an exact science though we were naive in thinking we could expect support from the financial provider to take into account any differences of between 10 - 20%. We are not experts just normal ever day people trying to build a home at a realistic cost and to protect our investment. This is not for re-sale for profit! You appear to more the expert, what would your solution to this be?

Yes but again, nothing to do with the lender.

I'm no expert, never said I was but if it's not for resale and therefore quick profit why don't you spend the £150k and do the rest of the £70k work over a period of time after you've moved in? Although you did say in your first post that if you dont do the full job it won't reach its investment potential - so which is it?

It's a sign of the times that lenders are more cautious and will base their lendings on affordability to pay back the loan primarily. They have to weigh up the pros and cons of you the borrower being able to meet the repayments and if not, them being able to resell the property and get their loan back. Bear in mind also that higher valued properties have less of a market - and potentially a more savvy potential buyer.

AJAX123_2

Conrad wrote: »

Most developers I deal with make around 15% profit on a deal. Yours is an exceptional deal - surpising other developers (that all EA's keep details of) were'nt all over this property.

They never got a chance! we purchased this as it went on the market and secured it with conditions to take off the market before the developers got a whiff. Purchase was made very quickly in the depths of recession when there was less money around than there is now!

dimbo61

You have £150K so you get best value for your money on every penny you spend on the property.
Earn as much spare money as you can and do as much of the work as possible.
You need plumbers, bricklayers, electrians but you can paint and labour for them and shop round for all the materials.
Get the main building work done and do the interior work later