Help, how can we fund an extension?

emmie26

Me and my husband moved into our house in 2006 and we always intended when we had renovated the property that we would build an extension to the side to give us two extra bedrooms and a large kitchen. Our mortgage is up for renewal next march and by this time we sould be completely debt free apart from the mortgage, so is the perfect time to start the extension. We are in secure jobs and earn enough to extend our mortgage but was wondering if anybody could offer any advise about how the loan to value would work. Our house is probably worth about £130,000 (at best) and we owe £100,000, we would probably need at least £50,000 for the extension as my husband will be doing some of the work. As we need more than the house is currently worth how would we go about getting the money needed?

VIGILANT22

Save..............

emmie26

That's an absolute last resort it would take us years and years, there is no way we have that sort of will power or patience. I have massive respect for people who can save but as you can see from my signature we are spenders, we are paying off our debt this year but then we want to start spending again (just within our means this time;))

Thrugelmir

emmie26 wrote: »

That's an absolute last resort it would take us years and years, there is no way we have that sort of will power or patience. I have massive respect for people who can save but as you can see from my signature we are spenders, we are paying off our debt this year but then we want to start spending again (just within our means this time;))

If you learnt to control your spending habits then it wouldn't take years and years.....

Once you've cleared all your "other" debts, tackle the mortgage. If you really want the extension then its totally in your hands. Stop making excuses that we are "spenders". You are merely impatient.

No mortgage lender will entertain your request.

leekat21

Perhaps you should scope out whether an extension is a viable option before you start wondering how you can get funding for it?

I mention this because my OH & I moved into our semi detached house which is a mile outside the main village and half a mile from the nearest neighbouring property (other than next door) and we had a quite a fight on our hands to gain planning permission for our extension. (Next door wanted to do the same extension so symmetry of the 2 semis was to be exactly the same)
We were told that adding 2 storey extension with 2 bedrooms and a large living /dining room impacted on the street scene and wasn't in keeping with the original purpose of the property.
Eventually, we agreed on one large bedroom with ensuite, a living room and a garden room. The extension has to be set back from the original property by 300mm and the ridge height also has to be stepped down.
Our's is costing far more than the £50k you have mentioned, in fact double it and you come close.
Just some food for thought. Maybe a chat with your planning dept or an architect will help you scope things?

smitchy73

Some lenders will lend based on the projected value of the house after the extension, and you get some lenders who specialise in these types of loans too.
But to get that you tend to need plans drawn and approved by the planning department. So you may need to save some money to do this and look into the lending, best advice is to speak to your lender and see them about your plans.

VIGILANT22

smitchy73 wrote: »

Some lenders will lend based on the projected value of the house after the extension,

and this would only be paid in stages.

Hopejack

I do think with the kind of ltv mortgage you have on your house that you are not going to get very far with a lender - sorry to say. I think you will have to save a little bit like others have said. Or start some serious overpaying on your mortgage to get that ltv down but that is going to take a while if you are paying off other debts too.

It's very good advice to speak to your planning dept to get an idea if you'd even get planning permission etc, pointless thinking about it if you wouldn't.

Dan_1976

In 2010 spending 20k over your current value is not a good idea. You run the risk of it not increasing the value enough.

THere will be a max price based on the location of your house, this is why people say location, location, location.

You can re build a house but you can move it to mayfair!

Look in to this a little more before you spend.

emmie26

Thanks for all the advice, I knew there would be some constructive advice around;). In answer to some questions, the price is purely a stab in the dark, we have a friend who has had a slightly smaller extension for around 45k doing none of the work themselves, we are hoping to just have the shell done by builders and then family do all the electrics, plastering, kitchen etc, although we are worried it won't reduce the price that much.
Planning permission shouldn't be too much of a problem (famous last words) approx half the houses in the street have 2 storey extensions. As far as the moving or extension decision, we are worried that to stay in the same area we would not get anything as big, we have a huge garden which backs onto fields, and with the extension we would have a massive house with a reasonable driveway. We would not be able to make any proper decisions until we knew all the costings, but we don't know if we should pay for plans and get planning permission if we are not going to be able to get the money. If we can't raise the funds then saving is not an option we would just have to move.