Remortgage for home improvements - newbie question

SavvySpaniel

Hi there, I have just joined the forum and have already found loads of useful information.

I do have one question which I am trying to find an answer to but so far haven't seen any similar threads. I hope you don't mind me asking this - it really sounds like a very basic question which I feel I should know the answer to ... but ashamed to say I don't!

We have a mortgage which has another 7 years to run (£46,000 outstanding). Our house is worth around £300,000. We would like to replace our ageing conservatory on the back of the house with something a bit more permanent and we thought that one option was to borrow some extra against the mortgage.

Our existing mortgage rate is Base + 0.25% - so the last few years of low rates have been really good for us!

My main question is: if we approach our current mortgage company, will we be able to borrow £10k and pay it back at our existing rate/timescale? Or would the new amount be considered a new mortgage?

Thanks

Hutchd97

Hi,

The new borrowing would be classed as a separate mortgage and the the rates would be different to the existing part. It also depends on the current lender (that looks like a Barclays rate) as to whether they would allow you to take out any additional borrowing. If they wont then you could look at a second charge mortgage with a new lender, however their rates and fees are normally quite high. It would also be advisable to look at an unsecured personal loan for that amount of borrowing, the rate might be comparable or better than a second charge loan and it has the benefit of not being secured against the property.