First Time Buyer Advice...

LawGraduate22

Hi everyone, I'm new to this so thanks in advance for any advice you can offer me!

Myself and my fiance are fortunately in the position to be buying our first home later on this year (he will qualify as a doctor in July so as soon as he starts work we are good to go!). After renting for the past 4 years we have finally managed to save up enough needed for a deposit but after this, plus all the extras that come with purchasing such as legal fees, lender fees etc, plus saving up for our wedding, we won't have much left over in the savings account!

My question is therefore, is it heard of to be able to borrow more than the amount needed on your mortgage in order to do home improvements? Say for example we were to purchase a house for £150,000 with a 10% deposit, but it is in need of £5000 worth of improvements, could we add this on to the mortgage so in effect we were taking out a £140,000 mortgage instead of the £135,000 after the deposit?

I've been struggling to find out if this is possible (might simply be because it isn't but I'm hoping not!) so if anyone can shed any light then I'd be really grateful!

Many thanks, LawGraduate22 xx

Generali

LawGraduate22 wrote: »

Hi everyone, I'm new to this so thanks in advance for any advice you can offer me!

Myself and my fiance are fortunately in the position to be buying our first home later on this year (he will qualify as a doctor in July so as soon as he starts work we are good to go!). After renting for the past 4 years we have finally managed to save up enough needed for a deposit but after this, plus all the extras that come with purchasing such as legal fees, lender fees etc, plus saving up for our wedding, we won't have much left over in the savings account!

My question is therefore, is it heard of to be able to borrow more than the amount needed on your mortgage in order to do home improvements? Say for example we were to purchase a house for £150,000 with a 10% deposit, but it is in need of £5000 worth of improvements, could we add this on to the mortgage so in effect we were taking out a £140,000 mortgage instead of the £135,000 after the deposit?

I've been struggling to find out if this is possible (might simply be because it is but I'm hoping not!) so if anyone can shed any light then I'd be really grateful!

Many thanks, LawGraduate22 xx

If you borrow £140,000 against a house worth £150,000 you are putting down a 7% deposit regardless of what you use the extra £5,000 for.

If the improvements are going to improve the value of the house you could borrow the money (on interest free credit cards?) and then remortgage against the increased value of the house.

amnblog

The smart thing to do would be to get married, buy a home, and then improve the home when you can afford to do so.


Not to borrow on cards for home improvements.

ognum

LawGraduate22 wrote: »

Hi everyone, I'm new to this so thanks in advance for any advice you can offer me!

Myself and my fiance are fortunately in the position to be buying our first home later on this year (he will qualify as a doctor in July so as soon as he starts work we are good to go!). After renting for the past 4 years we have finally managed to save up enough needed for a deposit but after this, plus all the extras that come with purchasing such as legal fees, lender fees etc, plus saving up for our wedding, we won't have much left over in the savings account!

My question is therefore, is it heard of to be able to borrow more than the amount needed on your mortgage in order to do home improvements? Say for example we were to purchase a house for £150,000 with a 10% deposit, but it is in need of £5000 worth of improvements, could we add this on to the mortgage so in effect we were taking out a £140,000 mortgage instead of the £135,000 after the deposit?

I've been struggling to find out if this is possible (might simply be because it isn't but I'm hoping not!) so if anyone can shed any light then I'd be really grateful!

Many thanks, LawGraduate22 xx

You probably know this but the best thing for you to do is to find out what deanery your partner is accepted for before looking for a house, he may not get his first choice and then after F1 and F2 may end up somewhere else again!

Your finances need to cover, the deposit, the legal fees and the renovation work. Of course renovation work can be over many years.

So, keep saving, have a cheap wedding and buy somewhere that is liveable! Good luck.

amnblog

ognum wrote: »

have a cheap wedding

Sounds nice - can I come?

pinkteapot

Generali wrote: »

If you borrow £140,000 against a house worth £150,000 you are putting down a 7% deposit regardless of what you use the extra £5,000 for.

^^ This.

The home improvements, etc, are irrelevant to the bank. All you tell them is how much the house costs (price) and how much mortgage you want. If you don't want to put all your savings into your deposit and to keep some back to do up the house, have your wedding, or just to fritter away, that's fine. Just means your deposit is smaller.

As Generali said, in your example you're then putting down a 7% deposit and would have a 93% LTV. This will severely limit your choice of mortgage as 95% is the maximum LTV you can get and the rates aren't the best. If you can put down 10% you'll have a bit more choice of mortgage product.

If you can, buy a house that's in a liveable state (even if the decor isn't to your taste) and then do it up gradually, room by room, over the next few years as you save up.