Would you remortgage to buy a building plot?

alexisuk_2

Our house is worth between 250 and 300k (doing the final touches before getting agents in to value - I know there is a big difference, esp with stamp duty threshhold, but that is not what my question is about). Mortgage currently 115k.

As our next house we would love to build. We have been looking around at plots and have found one we love for 100k.

Would we be able to remortgage our current house to get at the equity to buy the land. While then sorting out PP, at same time as trying to sell house.

Or is this all just a silly idea?

tyllwyd

If you have a mortgage of £215 (old house plus building plot), have you got enough income to pay that easily while you wait for the house to sell? What happens if you have trouble getting planning permission? Do you need to sell the house to get enough money to start building the new one - where do you intend to live in the meantime? Will the equity from your old house be enough to pay for the full building costs of the new house, or will you need to raise money somewhere else?

To be honest, it all sounds a bit risky to me unless you have funds saved elsewhere - if the costs went up more than you expected, you'd be very exposed.