Best mortgage options for house renovation?

big_questions

Hello,

I'm looking at moving house, and the place I'm buying will need a lot of work, and has lots of opportunities to extend. My estimate is the work could be between £50k (basic renovation) and £100k (extending at the same time). I don't yet want to commit to budget.

I guess my question: are there better/worse types of mortgages for increasing yr borrowing flexibly?

My current mortgage is £100k, (at an excellent 0.99% interest rate.)
Ultimately, I'd be looking to borrow between £150-200k.

Thanks.

kingstreet

It depends on the purchase price, mortgage amount and if the property is mortgageable, depending on the extent of the "renovation".

You could be working from one end of the spectrum of a "normal" mortgage with a normal lender, to a renovation mortgage from the likes of BuildStore, with all points inbetween.

big_questions

Hi Kingstreet,

Thanks for yr reply. Basically:

House is perfectly liveable-in, just old-fashioned and badly in need of updating (tiny kitchen, tiny bathroom which is downstairs and only accessible through kitchen, with toilet separate at other end of the house etc).

A mortgage of £200k would be 45% LTV.

kingstreet

If the property is mortgageable in its current condition, consider borrowing all the money you'll need to then outset and choose an offset product.

Put the funds for the renovation in the offset account, so the amount you will pay will be based on the net amount of borrowing.

That way you only have one mortgage application to make and only pay for the extra borrowing, from the point you actually use it?

big_questions

Neat. Thanks.