Re-mortgage for Home Improvements/Extensions

Addd

Hello.


Has anyone an opinion on the best way to fund a home extension?


Say I have a £110'000 house with a £77'000 mortgage could I re-mortgage and borrow a further £30'000? I'm thinking of a loft conversion.


How would the LTV work out baring in mind the house valuation would rise once the work is done. I'm guessing Lenders wouldn't take into account the valuation of the house after work is complete. So would you have to re-mortgage again to get a better rate once you have completed the work?


I require some more space and I'm just trying to find the most effective ways of doing this.


Had to remember and type this out again as it didn't send first time. I'm sure I've forgotten something. :wall:Apologies if I sound like I don't know what Im talking about. That's because I don't really.:D


Thanks anyway to whoever replies.:beer:

ACG

There are various ways to do it, but if you stay with your current lender your current balance would/could usually remain on the LTV currently with the top up at the higher LTV.

Once the work is complete you could remortgage but usually there would be ERCs to pay so it might be better just keeping it on the deal for the 2 years.

The alternative would be to take out a secured loan, do the work and then remortgage once done. The secured loan would usually be at a higher rate and may incur fees.

In short, there is not definitive answer, it depends on the lender you are with, the deal you are on (if any) and so on.

dimbo61

£77,000 mortgage plus £30,000 for extension is £107,000.
If property is worth £110,000 in current condition it's not going to happen.
Over 95 percent LTV