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Is it possible to take out mortgage above purchase price for renovations
startingout2016
Posts: 213 Forumite
We have a mortgage agreed in principle.
The house we were buying fell through so have been looking again.
Found a house that needs renovation work. Its on at under £30k less than our AIP.
It needs approximatley £20k spending on it and the same houses down the road that have had the renovation done are now valued at over £80k more.
Would it be possible to do these renovations by having a mortgage over the purchase price?
The house we were buying fell through so have been looking again.
Found a house that needs renovation work. Its on at under £30k less than our AIP.
It needs approximatley £20k spending on it and the same houses down the road that have had the renovation done are now valued at over £80k more.
Would it be possible to do these renovations by having a mortgage over the purchase price?
0
Comments
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No. Maximum mortgage is 95% of lower of purchase price or valuation.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.0
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2005 is on the phone, asking to have 110% mortgages back...
The lender needs adequate security for their loan to protect themselves if you don't repay. If you borrow 100%, there's really no headroom after the costs of repossession are deducted. If you borrow more than 100%, they're instantly in trouble.
But you may like to rework your sums anyway - spending £20k is VERY unlikely to get you an £80k increase in value. If it did, then somebody else would happily be paying £50k more than you think you can get it for, and still making £10k profit...0 -
You'll have to take out a loan.
Ridiculous how everybody is suffering with the absurdly strict Mortgage Market Review rules, but then you can take out a £20k mortgage the day after you move in and default on your mortgage.0 -
...... you can take out a £20k mortgage the day after you move in and default on your mortgage.
I don't know what percentage the £20k represents but with a 95% mortgage already I would have thought getting a second mortgage the day after (or anytime) would be very difficult indeed.0
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