Mortgage and Home Improvement Loan

E_Mayo

Hi Everyone,

Me and my boyfriend are first time buyers, we are looking at the help to buy mortgage were we receive a 95% loan. We looked at a house yesterday Its on the market for £139k lets just say its not worth that at all. The next door neighbor informed us the estate agent told him he wouldn't pay £115k for it. It needs alot of work; rewiring, new roof, gutting, prob a new heating system and its so grotty inside! Basically had nothing done since it was built in the '60s. We love the property and see its potential, we are willing to put in the hard work to change it into a home.

I worked out a a rough cost which comes to £12k of work, which we don't have.

I thought you could get a certain mortgage amount then use the difference to renovate the house, which i know you cant do now due t0 the recession. Could we get a home improvement loan built into the mortgage or would this have to be separate?

An help or ideas would be great!

Building_Surveyor

Take out the mortgage, then take out a loan once you move in is an option. If you take out a loan beforehand the mortgage provider will reduce affordability ... That's if the property is mortgageable.

These types of properties are more suitable to people who have the disposable cash. If the work runs over budget... Then what?

And forget what the neighbours said, unless he's done a valuation himself.

P.s with a 95% mortgage and a loan thrown in the mix you will overall have debt larger than what the house is worth irrespective of whether it is seperate.

BitterAndTwisted

"Rewiring, new roof, gutting, prob a new heating system"

A new roof alone could cost double that twelve grand estimate for the total works. Forget it, you can't afford to buy this house unless you've already got money in the bank for this sort of renovation.