Basic remortgague question

pmartin86

Afternoon All

I know its a long time away but I'm basicly trying to plot a course through the next 20 years of my financial life! I recently (3 months ish) ago bought my first house on a 90% LTV 2 year fixed mortgage. Since the purchase I have spend aproxx 15k on renovations/modernization and had it valued at arpoxx 21k more than I paid (Winner!) I dont wish to sell but would like a vague idea of what to do after the 2 year fix. Should I remortgage, would I then be able to apply for a lower ltv (assuming the abnk agrees with valuation of course?) example, if i paid 80k with a 70k mortgage, after 2 years i remortgage at 70% ltv if the house is then worth 100k? (obviously ignoring the repayments made and variances etc, this is all hypothetical?)

National_Debtline

Hello there. Your LTV will be based upon the property's value in 2 years time and the amont outstanding on your mortgage at that point. Given that you've increased the house's value you should hope to be offered a more favourable rate with a better LTV ratio. Do shop around to get the best deal!

Best wishes,

David @ NDL.

pmartin86

That's what I was hoping for, thank you very much

kingstreet

pmartin86 wrote: »

Should I remortgage, would I then be able to apply for a lower ltv (assuming the abnk agrees with valuation of course?) example, if i paid 80k with a 70k mortgage, after 2 years i remortgage at 70% ltv if the house is then worth 100k?

Yes.

The lender will have the property valued and establish the LTV at that point.

A surveyor may, or may not, agree with your estimated value, so ensure you check the sold prices of recent (120 days), similar property in the (0.5 miles) area;-

http://www.rightmove.co.uk/house-prices.html/svr/3106;jsessionid=662B58B6396CA33EF7D29784D8603C58

as these are the "comparables" used by surveyors.

pmartin86

Yeah Im aware that the bank might not agree, I basically just wanted to know how it worked in principle, looking at some of the 70% ltv figures are considerably better than the 90% ones, I'm working on the approximate idea that it [strike]will[/strike] SHOULD be about 70%, I can always overpay on the current rate for a while if need be to get to the "magic number!"