House extension, savings or remortgage

Hi all, wondering if you could help.

My husband and I are looking at getting an extension on our 2 bed house, turning it into a 3-bed. It will be a two-storey extension that may cost in the region of £60,000. We have that money currently invested in Vanguard index funds, but we're struggling to work out what the best option would be.

1) Withdraw the money from Vanguard and pay for the extension in cash – The Vanguard index funds make around 10% a year, but there has been the odd year where it's nothing more than 1%, or even a slight loss, so it's not a certain return.

2) Remortgage at a rate of around 1.8% interest and continue to pay double our mortgage minimum payment (approx £1100) a month – We have already paid off nearly 50% of our mortgage, around £80k left to pay... house was bought at 150k, and is currently worth around 180k).

3) A bit of both... 50% of the cash from Vanguard, and 50% from a remortgage.

4) Or a fourth option we haven't thought of yet?

Thanks in advance!

Saving Total 1st Jan 2017: £47,819.92 | 23rd Jan 2017: £49,611.38 | 28th Feb: £50,461.97 | March 2017 : £51,786.13 | April 2017: £53,251.52| May 2017: £54,219.71 | June 2017: £55,857.73 | Nov 2017: 53,375.46 Savings Goal: £100k:j £46,624.54 To go!
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