Extending Amount Borrowed on Mortgage for House Extension

bristol_rob

I was wondering if you lovely helpful (is that pandering enough ) MSErs could help me?

I am currently on Base Rate Mortgage with Nationwide. The amount borrowed on my mortgage is approx 50%-60% of house value at present.

I am looking to put a substantial extension on the property and estimate I could be looking at adding another 20-30% to current property value. Obviously, the value of the work should add an extra 40-50% to the value in theory.

In your experience, do you think there will be any issues/concerns with borrowing the additional amount with the same lender and on the same terms?

Any help, assistance, input greatly appreciated.

CLAPTON

I would think you have zero chance of an extension of a base rate mortgage for your extension although you may be well have a resonable expectation, subject to affordability criteria, of an additional mortgage

why not ask them?

Thrugelmir

bristol_rob wrote: »

I am looking to put a substantial extension on the property and estimate I could be looking at adding another 20-30% to current property value. Obviously, the value of the work should add an extra 40-50% to the value in theory.

That seems a tad optimistic.

Dave_Ham

Sorry Rob, this is bad news time.

No chance at all. They will offer you a second part mortgage on the new amount and the terms will be pretty lousy. This will force you to review your whole mortgage to take elsewhere (and lose the great rate) or let them make a bit more money on the second or b mortgage on a rate upwards of 5% I would think.

Add in, if you ever fix your first part you will essentially run with 2 mortgages and then have 2 product fees, 2 different fix end periods so gather as much information as possible from your lender and elsewhere and ensure your eyes are open and sums are correct before making a call.

All the best

gbcasual

I am in the same position as the OP.

Got a cracking mortgage at present (0.19% above BBBR tracker for life) and about to do a massive extension.

Spoke to Barclays about financing the extension and there was no chance of increasing the amount borrowed on the current mortgage (no surprise at all).

They said I can have an additional second mortgage to cover the costs though and said their current best offering to me would be 3.29% fixed for 2 years with £499 admin fee (going to BBBR +3.39%) and £150 further borrowing fee.

Overall not too bad.

I take it that I can't try for additional borrowing elsewhere and keep the current mortgage where it is?

Dave_Ham

gbcasual wrote: »

I am in the same position as the OP.

Got a cracking mortgage at present (0.19% above BBBR tracker for life) and about to do a massive extension.

Spoke to Barclays about financing the extension and there was no chance of increasing the amount borrowed on the current mortgage (no surprise at all).

They said I can have an additional second mortgage to cover the costs though and said their current best offering to me would be 3.29% fixed for 2 years with £499 admin fee (going to BBBR +3.39%) and £150 further borrowing fee.

Overall not too bad.

I take it that I can't try for additional borrowing elsewhere and keep the current mortgage where it is?

You can - but you will get nowhere near that Barclays rate - I would snap their hand off and channel the assumed overpayments that you are making to the new 2nd loan mortgage...

Nice mortgage deal - bet you are pleased...

bristol_rob

Thank you all for your replies, I knew you would know. Shame it wasn't the news that I wanted. I will do a bit more digging anyway, maybe even look at Barclays.

Thrugelmir

gbcasual wrote: »

Got a cracking mortgage at present (0.19% above BBBR tracker for life) and about to do a massive extension.

Then you should be able to save up for the extension.

gbcasual

Aye, very happy with the current mortgage for sure. Was overpaying massively but channelled that to a monthly savings account when it was clear we would extend.

It is a huge extension though so I will still need another large mortgage, hopefully interest only as I have some endowments I can allocate to repay it long term.

Thanks for the input

bristol_rob

Hope this all sorts itself out for me. Going to speak to NBS on MOnday
Fingers crossed