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Mortgage for redevelopment / extension project
caronoel
Posts: 908 Forumite
Hello
Is it possible to release equity in a mortgage to fund a redevelopment.
Situation is that existing house is worth £1.5m, with £0.4m or so left to run on the mortgage. (Current LTV is well under 40%)
We are considering spending approx £0.3m to expand the property. This would take the value up to approx £2.25m
Even based on the property's existing value and borrowing all the additional 300k, the new LTV would still be below 50%.
We both earn good incomes, so the multiple wont be a problem, but will mortgage companies lend at regular rates on what will effectively be a building site for the next year?
If it makes any difference, we intend to live on site during the works
Thanks
Is it possible to release equity in a mortgage to fund a redevelopment.
Situation is that existing house is worth £1.5m, with £0.4m or so left to run on the mortgage. (Current LTV is well under 40%)
We are considering spending approx £0.3m to expand the property. This would take the value up to approx £2.25m
Even based on the property's existing value and borrowing all the additional 300k, the new LTV would still be below 50%.
We both earn good incomes, so the multiple wont be a problem, but will mortgage companies lend at regular rates on what will effectively be a building site for the next year?
If it makes any difference, we intend to live on site during the works
Thanks
0
Comments
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Possible, but needs to be deal with carefully.
Lenders generally wont want a building site as security.
Definitely one for an experienced broker.I am a Mortgage Broker
You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.0
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