first time mortgage with renovation cost

shawryshaw

Hi daughter and boyfriend have been to banks to see how much they could afford to borrow on a mortgage. Nat west agreed £200k with 5% deposit and hsbc £216k with 5% deposit.
They have been house hunting with those figures in mind. They have now made an offer of £183k on a property that was on the market originally for £210k. The property needs approx 20k rennovation to bring the heating and kitchen in to line. The offer has been accepted but they thought they could have a mortgage for £200k on the property and use 17k for ennovation, but the lender has now said they can only have a mortgage for the property price of £183. This seems harsh as the property would be worth in excess of £200k when work complete. Is there another way they can do this?

betmunch

Not with a mortgage.

The maximum mortgage they can have is 95% of the property price.

Once they have completed they could look at other finance options, although whether that's wise is another question