Best way to raise some money!!

Rusty_bongo

Hiya
We currently own our house outright, but are growing out of it quickly (2 pre teens). We have a 3 bed semi worth around £165k. I want to know how I go about getting raising around £30k for an extension. I have £20k in cash, so a budget of around £50k).

My husband earns around £25k pa and I earn around £20k, so keeping monthly payments low is important.

We are both 47.

Is a mortgage the best way to go? 
Any ideas much appreciated!
🤗

Retiredwelshman

Is the extension a better/cheaper option than moving?

Rusty_bongo

Retiredwelshman said:

Is the extension a better/cheaper option than moving?

I would love to move! But a 4 bed house round here costs £320-£350k. The mortgage would be too big  - even with a £185k deposit (£165 in the house + £20k savings). 😔

DrEskimo

Probably a mortgage. You are going to struggle to borrow that much through a unsecured loan given your salaries.

A short term mortgage with such a LTV should enable you to borrow at a low APR. 
There are some lenders offering 10yr fixed deals at 1.99%, which would be around £275 per month.

Most will charge a product fee of ~£999 as well but may find a smaller lender without this fee.

Herzlos

What are you doing with the extension? If it's fairly simple then you may save a small fortune with a separate garden room.
Can you split the work or downgrade it to a smaller budget?
Have you got much old stuff to sell? We've done quite well having a clearout and generated a bit more space at the same time.

Re-mortgaging for what you need to borrow is likely the easiest approach, assuming you've got enough equity.

[Deleted User]

If you have a 3 bed semi and only need 3 bedrooms why bother, especially in these uncertain times?

Rusty_bongo

Herzlos said:

What are you doing with the extension? If it's fairly simple then you may save a small fortune with a separate garden room.
Can you split the work or downgrade it to a smaller budget?
Have you got much old stuff to sell? We've done quite well having a clearout and generated a bit more space at the same time.

Re-mortgaging for what you need to borrow is likely the easiest approach, assuming you've got enough equity.

Needs to be a bedroom really. The only reason I want an extension is that my eldest is in the tiny box room, it is really small. Also, I work from home now - and will be doing indefinitely, I could really do with using the box room as a study.

Ted_Head

Is there any way you can gain space within the house? Do you have a loft? Seems a load of cash just to give your eldest child a bigger bedroom. They won't be at home forever.

kimwp

If you have a separate living room, you could turn that into a bedroom, tack a garden room to the back of the house to replace the space and use the box room as your study. A downstairs bedroom feels weird in a two storey but is standard in a bungalow, plus no debt!

enthusiasticsaver

For £30k the cheapest way will be a secured loan (mortgage) given you own the house outright but you will have legal fees on top of any loan arrangement fees.  Alternatively go for a cheaper extension or do it in phases and maybe an unsecured loan on top of your cash or 0% cards but if you want to keep monthly costs low that may put too much pressure on you to clear within a short time. Unsecured loans will be more expensive but repayment period should be shorter.  

Herzlos

So what are you planning extension wise? £50k seems a lot for adding a single bedroom on the back.
Depending on how old the kid is, how much time they spend in the room and how much they care about, I'd be inclined to leave them in there and put an office in a garden room and keep the other £40k for cars or playstations or something.