Advice needed about financing house extension

ladycat_2

I've decided to extend my house as it's cheaper than moving and we like where we're currently living. The plans are with the Council and it looks like we will get planning permission, so I'm trying to decide how best to finance the extension. I haven't got any actual quotes from builders yet, but the cost could be anything between £35K and £50K (probably nearer the higher figure). I currently have a capital and repayment mortgage with about £12K outstanding and another 6 years to run on the existing house.
My OH also has a small house to sell (£100K after we've done it up), but this could well take 12 months to complete. He has to pay £33K from the sale to get rid of his mortgage and we were originally hoping to invest the balance to provide some form of income in retirement for him, in addition to my pension.

Should I try and get a loan to cover the whole amount of the cost of the extension and pay it off with the proceeds from OH's house (and keep my current mortgage running)?

Should I remortgage to cover what I currently owe plus the cost of the extension?

Or is there a cheaper way - any advice from those who've been through this process would be much appreciated - thanks.

chappers

The cheapest money will probably be one of your mortgages, rather than a seperate loan, you could always pay it off from the proceeds of the house sale anyway, providing you can overpay on your mortgage.

dimbo61

if you decide to go for remorgaging consider offset mortgages.
you can borrow the money to clear your old mortgage and build the
extension and when your other half gets his money from selling his place
you can offset the whole amount against your mortgage.
by taking out a new offset mortgage you can pay the extension money
into the offset account and use it only when needed to pay the builders
or buy materials ( saves you interest )
this is also a good place to build up your nest egg for the future
GOOD LUCK

ladycat_2

I hadn't really considered an offset mortgage (only ever had endowment and capital and repayment before), but I'll check it out. It sounds like a very good idea, thanks.