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Mortgage including the cost of renovation

fiveinourhouse_2
fiveinourhouse_2 Posts: 120 Forumite
in Mortgages & endowments
I was wondering if anyone could help, please. We have been looking to buy a property. We have seen a family home that has enormous potential. It is valued at 260k but the seller has given an asking price of around 200k. The property requires a new kitchen, bathroom, carpets etc as it is very old.


Is it possible to borrow a mortgage which includes the 200k for the property and an additional 30/40k to do the work required?
Thank you

Comments

  • Caz3121
    Caz3121 Posts: 15,853 Forumite
    Part of the Furniture 10,000 Posts Name Dropper
    any mortgage will be based on the current valuation or the purchase price, whichever is lower
    so if 90% mortgage and you agree a purchase price of £200k and it is valued at £260k then you would be able to get a mortgage of £180k
    You need to find the money for the renovations, deposit, stamp duty etc on top
  • tomtontom
    tomtontom Posts: 7,929 Forumite
    Who has valued it at £260K?
  • kingstreet
    kingstreet Posts: 39,315 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    You might be better off talking to a broker about a specialist renovation/refurbishment lender/product.
    I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, 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. Please do not send PMs asking for one-to-one-advice, or representation.
  • fiveinourhouse_2
    fiveinourhouse_2 Posts: 120 Forumite
    Surveyor that did the detailed home report has valued it at 260k but it is an elderly couple that want to sell quickly so dropped price to 200k. We have our current property to sell so will have some funds for the deposit. We may go down the route of getting an independent loan. Does anyone else have any experience of this? ie. getting aloan for renovation work and do they end up costing more than they are worth? Thanks
  • ACG
    ACG Posts: 24,689 Forumite
    Part of the Furniture 10,000 Posts Name Dropper I've helped Parliament
    You could borrow based on the purchase price and then either take out a loan to cover the rest or take out a further advance in 6 months.
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a mortgage adviser, 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.
  • Thrugelmir
    Thrugelmir Posts: 89,546 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    fiveinourhouse wrote: »
    Surveyor that did the detailed home report has valued it at 260k but it is an elderly couple that want to sell quickly so dropped price to 200k.

    I'm struggling with this. Quick sales don't require £60k drops (23%). Particularly if it's going to take £30k to £40k to put the house in good order.
  • amnblog
    amnblog Posts: 12,762 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    You may be able to do something with this with the correct specialist funding, but forget about mainstream mortgages. One for a 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.
  • fiveinourhouse_2
    fiveinourhouse_2 Posts: 120 Forumite
    Thrugelmir wrote: »
    I'm struggling with this. Quick sales don't require £60k drops (23%). Particularly if it's going to take £30k to £40k to put the house in good order.



    Its a very elderly couple and their circumstances are that they would like to move fairly quickly due to health. They have lived in the property for an extraordinarily long length of time. What's not to get?
    Thanks for the help everyone. We have a broker but he is away on holiday at the moment. Counting sleeps until he gets back.
  • fiveinourhouse_2
    fiveinourhouse_2 Posts: 120 Forumite
    Why does the drop in price concern you? My husband and I are rather clueless about this sort of thing so somewhat anxious about it all.
  • alchemist.1
    alchemist.1 Posts: 860 Forumite
    fiveinourhouse wrote: »
    Why does the drop in price concern you? My husband and I are rather clueless about this sort of thing so somewhat anxious about it all.

    It is very unlikely in a sellers market to have to discount a house for over a quarter of the correct value (even if you want to sell quickly).
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