home improvement costs added to mortgage

razoni

Hi Guys,

Myself and my girlfriend are first-time buyers. I have searched the forum for answer to this but cannot seem to find one.

Basically we both earn good wages for our ages me 25 her 24 both on £27000 per year. We want a house well within budget 150,000 max.

We have seen a house priced £119000, however this house needs extensive work-not structure but;
complete rewiring, new heating system, bathroom, kitchen decoration.

My father is a builder/dampcourser and does this work every week and stated it would cost about £15000.

My question is this can that amount be added to the mortgage? or would we have to find that money ourselves? There are other houses on the ame street going for 180,000 whuch have had this work undertaken.

ANy comments would be welcome thanks Ryan

booksurr

the days of being able to borrow more than the value of the property are now ancient history

if the house is "worth" 119K then you won't be able to borrow more than that, and more likely you will be limited to 95% (ie 113k borrowed with a 5% deposit from you) so to answer your question you will have to pay for improvements yourself from cash not by adding it to a 95% mortgage on a 119k house, even if you can afford to borrow up to 150k

razoni

Hi thanks that reply-we have about a 12% deposit for a 120k house at the moment-so basically either keep saving for a house worth more or save for the work to be undertaken.Thanks!

Argghhh

pay less deposit and keep it back for improvements

kingstreet

Yup.

Get a 95% mortgage and use the remaining "deposit" to fund your improvements.

When the early repayment penalties run out, remortgage to a new lender or try to get a better rate from your current lender.