£5,000 loan for building work

Jimbob4life

Hi, my partner and I just purchased our first property last month on a 90% mortgage and had around £3500 saved up to decorate and purchase furniture however upon working on the property we decided it would be best to get some of the work we planned to do in the future done now whilst we can still live at our parents, this involves new guttering and windows and a few rooms re-plastered. I believe an extra £5,000 should be more than enough and was wondering what loan options may be best for us.
A friend mentioned calling our mortgage provider and seeing if the extra £5,000 could be added to the mortgage is this possible at such an early stage and what affects would it have other than higher payments such as increase in interest rates etc.
Or would it be best to stick to a personal loan which when i looked at them worked out at a total repayment of around £5750 over a 5 year period

Thanks in advance for any advice

SeanG79

It is unlikely that the mortgage provider will increase the mortgage so soon, but you will only know if you ask. Bearing in mind with even the lowest mortgage rates, £5k over 20 years, you will pay back c.£7k

Personal loan would be the cheaper and easier option at this point, if you don't want to or cant wait to save up to do the work.

Foxy-Stoat_3

Either finance it by credit card and transfer the balance to 0% card once your done and pay it back over 2 years or take out a personal loan...you could always save up and get the work done in stages.

You wont want to take out a secure loan for £5,000 and your mortgage lender will unlikely add additional debt to your already 90% mortgage unless these are essential repairs and they are feeling very generous and charge you very high fees.

CLAPTON

SeanG79 wrote: »

It is unlikely that the mortgage provider will increase the mortgage so soon, but you will only know if you ask. Bearing in mind with even the lowest mortgage rates, £5k over 20 years, you will pay back c.£7k

Personal loan would be the cheaper and easier option at this point, if you don't want to or cant wait to save up to do the work.

no this is incorrect

if you can repay the 5000 over say 2 years, then if you can increase the mortgage, use the repayment money to over pay the mortgage

Foxy-Stoat_3

1. The lender will unlikely let you borrow against the 10% capital you already have.
2. If the lender agrees to the release of equity, then there will normally be a minimum of £10K or there abouts.
3. The lender will only normally agree to equity release for essential repairs.

Personal loan is the best way forward, if saving is out of the question.

Jimbob4life

Saving is not necessarily out of the question but ideally could do with the work being done now before we move in, it is to replace the single glazing with double, a few repairs to roof and replace the combi boiler that was installed in 2002 leaving us with the majority our current savings to do the decor and furnishings.

It looks like either personal loan or credit card could be the best options available to us atm