Loan For Renovation

JulieMoss

We need to borrow £20,000 for kitchen/home improvement at the end of a very lengthy and costly renovation of an old property. We will be moving in to a property which was my grandparents, which was inherited by my parents when my grandparents passed away. We had agreed a price for this property before any extension etc was started, with exhausted funds near in £200,000 we need the last £20,000 to complete it all, which is mainly the kitchen. We have our current house to sell which is mortgage free but obviously cannot move in ideally until the other house has all its work completed so there will be money there when the house is sold. We are looking to hopefully move in this summer so only need this £20,000 loan for a short amount of terms. Please can somebody advise on what to do? :money:

enthusiasticsaver

You can either try raising £20k on your existing mortgage although the lender may balk at the improvements being done on another property. That depends on affordability, your existing mortgage and LTV. That will probably be the cheapest way of doing it though but you will need to be in a position to pay your existing mortgage plus the new £20k loan.

You can raise a mortgage on the mortgage free property of £20k but that will involve more in the way of costs for solicitors and land registry costs etc. Where did the other £200k to buy the property and do the existing renovations come from?

You can sell your house and rent somewhere to live until the renovations complete. Use the sale proceeds to do the improvements.

JulieMoss

We don’t really want to remortgage as we are mortgage free, the other money came from the sale of my partners fathers house when he died. :-)

enthusiasticsaver

You can get unsecured loans for £20k but they are more expensive. Why not do option 3 and sell your house first and rent somewhere or stay with family?