Loft conversion finance

panamul

I'm looking to buy a house with an 85% mortgage. We would like to do a loft conversion straight away at a cost of £35000. There is reasonable evidence that this would immediately add at least £35000 to the value of the property.

We are looking for a low-cost loan which would take into account the fact that the money is for home improvements and that the money spent would immediately become equity in the property.

It seems logical that there should be competitively priced loans for this type of thing but we haven't been able to find anything. Only secured loans in the range of 10 - 11% p.a and upwards.

We also thought about a mortgage which pays out additional so the loft conversion can be done and uses the post-conversion property value to calculate the 85% they will lend against. We haven't found anything like this.

We also can't find any loft conversion companies offering competitive finance.

Is it just me or is the finance market missing a trick here? Surely it would make sense to offer loans for this type of thing around the 5% level and take a second charge on the property? Or offer a mortgage product in the first place which enabled this?

Any ideas?

McKneff

What kind of a loft extension are yu getting for £35K it seems an awful lot of money.

And to be honest, have you taken advice about it adding £35K in value to the house, personally I would double check.

If you plan on staying there for a long time I suppose it doesnt matter but dont bank on it.

CLAPTON

if there are similar properties that already have a loft extension then why not buy one of those instead?

phill99

You need to speak to a mortgage broker, not a high street lender. Brokers know the way to sort this out

panamul

McKneff - thank you for your comments but you haven't really helped. Of course we will shop around for the best value we can get. And without going into details, as mentioned there is reasonable evidence that this will add £35k to the value of the property.

Clapton - oh dear. Where to start! Shall we just leave it as given that there would be reasons?

Phil99 - Thanks for your constructive suggestion. I will look into this.

phill99

panamul wrote: »

McKneff -, as mentioned there is reasonable evidence that this will add £35k to the value of the property.

Unfortunately, that isn't the case. There is absolutely no evidence that a loft extension will add £35k to the value of a property. There is not a single valuer or surveyor that will give you a written valuation to that effect.

You will only know what it is worth once it has been built and then independently valued.

McKneff

personally I thought you were a tad rude in your response to my post, all I tried to do was help a newbie, and as far as I can see
I did, you came up with the figure of £35K. My daughter has just had quite a large loft done, with ensuite etc for £28K

Anyway Ive done my bit. Toodle OO

jc808

phill99 wrote: »

Unfortunately, that isn't the case. There is absolutely no evidence that a loft extension will add £35k to the value of a property. There is not a single valuer or surveyor that will give you a written valuation to that effect.

You will only know what it is worth once it has been built and then independently valued.

And you will only REALLY know when it SELLS at the given price