Mortgage to build extension and loft conversion

mr_auspicious

Hi

Me and my partner are in the process of selling and buying a house. I'm mortgage-free on the house I'm selling and after paying estate agent fees and stamp duty I will have £100,000 cash after I have purchased the new house

I'm planning on extending the kitchen and converting the loft, several of the houses nearby, including the house next door have had exactly the same work done with no problems with planning. To have the work done will cost approximately £250k so I'm looking at borrowing £150k against the house. The house two doors down which has had the same work done that we are proposing has just gone on the market with a selling price almost exactly £250k more than what we will pay.

Me and my partner also own another buy-to-let property with a £400k mortgage on it and with about another £700k equity that we are considering borrowing against, although we're tied in for another 18 months on our fixed rate and an extra £150k would take us to the maximum allowed according to the rent/affordability tests, it may be too much. I'm considering the possibility in a couple of years time we move the mortgage from our house to our buy-to-let property, when when we can remortgage without an early redemption penalty.

I'm a house husband at the moment, although I'll be working again soon, my partner is self-employed, but making the extra mortgage payments wouldn't be a problem, but I'm not sure how a lender would view our situation.

My question is how easy would it be to be able to borrow £150 or £200,000 against the value of the house we are buying?

Thanks in advance for any advice

FTBTom

I can't help on the mortgage question but £250k to extend a kitchen and convert a loft sounds HUGE! You could build a 4 bedroom house comfortably for that! Are you sure it will cost you that much?

MortgageMamma

Hello Mr Auspicious

It sounds a lot for an extension, but that's besides the point. You don't say what the value of the property you are buying is, and how much equity you will have in it. Etc. Also is your buy to let property self financing? is it on an actual buy to let product?

mr_auspicious

Hi

It does sound a lot I know, but we'll also be refurbishing the property, rewiring and plumbing, new boiler, adding a downstairs toilet and probably building an office at the bottom of the garden. I'm probably overestimating costs a bit but a quick chat with our friend who project mangages builds suggests it won't be far off, especially if my partner gets her way with the finishes. Its a hip to gable loft extension.

We're paying just short of a million pounds, paid for from the sale of our present home which is mortgage-free. After stamp duty and estate agents fees we'll still own 100% equity in the new house.

The buy to let property is on a buy-to-let mortgage, it's self-financing, we've had it for ten years