Home improvement loan-how long after mortgage?

Despina

Hi there,

We are thinking of applying for a mortgage of about 144,000 for a property worth 160,000. The property is livable but needs a lot of work. We have been told we can borrow up to 180,000, so could afford a much more expensive/done up property but would prefer to buy this one and do it up. One of my best friends is an architect and she made a conservative estimate that all the work we want doing would cost about £30,000. Our income is increasing and we would have 1-2 lodgers (in a 5-bed property), so we could afford to do that over a few years.

But - we don't know if we could deal with the amount of work and time/faff some of the work would involve, so we would like to take out an unsecured home improvement loan at the beginning, and do as much of the work as possible before we move in.

According to the calculator on here we would be able to borrow as much of the 30,000 as we want based on income and the fact that we would be mortgage paying home owners.

I was just wondering, will there be a nasty surprise if we apply for a home improvement loan very soon after our mortgage application? Or would we get offered ridiculous interest rates?

Any ideas/advice would be greatly appreciated!

[Deleted User]

You're unlikely to get a decent rate, if at all, very soon after your mortgage completes. You're also asking for a lot as an unsecured loan.

I would save for a while, then leave it 6 months or so after moving in to see what your options are.

Despina

Thank you! Good to know re rates. It might still be worth it for us as doing as much work as possible in one go before we move in would save a bit of time and money overall. We could also rent out two rooms rather than one (by fitting a new en suite bathroom), and the whole house would be nicer, so we could rent the rooms for slightly more money.
So we'd have to see what we might be offered and do the math

PeacefulWaters

we could rent the rooms

With mortgage lender approval.

System

Despina wrote: »

H One of my best friends is an architect and she made a conservative estimate that all the work we want doing would cost about £30,000.

An architect is not a builder. I would get a quote from a builder who because they're regularly involved in hands on work on older buildings is far more likely to be aware of any potentially costly pitfalls involved in any alterations than an architect who has probably never picked up tools in anger.

Despina

Thanks! We are having a second viewing today with a friend who is a builder. I've been in touch with him the whole time. I wouldn't take in a project like this without having him look at it beforehand.