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  • FIRST POST
    • Suzidil
    • By Suzidil 11th Oct 18, 12:31 PM
    • 4Posts
    • 0Thanks
    Suzidil
    Extra funds for refurbishment
    • #1
    • 11th Oct 18, 12:31 PM
    Extra funds for refurbishment 11th Oct 18 at 12:31 PM
    Good morning,

    I was advised to repost this here rather than under Loans since I was led to believe that mortgage products would not help in the very beginning.

    I would greatly appreciate your advice with regards to home refurbishment financing: whether and how we can access those offers as a home owner (not a developer). The extra funds we require are about 500K to bring the value of a 2m house to over 3m. We hope to pay it over back over 36months or more.

    If I may clarify, the house we would like to buy as our family home already has planning permission to extend and requires interior renovation/refurbishment. We already have Agreements in Principle to buy the house but need extra funds to do the works before moving in.

    The current value of the house is around 2m. The only builder we have consulted with has provided a quote of about 380K+VAT for the works which we would like to allow 500K for after taking it out to tender.

    Properties of a similar scale and scope after the works are on offer in the area for around 3.25m or above. We have no intention of selling the house and hope to make it our home for many years to come.

    I understand that our mortgage lender, Barclays, will not be of much help since they effectively lend back the equity already paid on the mortgage which will not be enough to cover the cost of the works in the beginning.

    After some preliminary internet research, I came across private finance options such as Property Development Finance, Refurbishment Finance and even Bridging Loans that seem to provide funds for such works but notice that they are either too short term or mostly directed at property developers.

    Before I go further, may I please ask the members of this forum as to whether there are such loans available to us and where best to look for them.

    Many thanks for your time in advance.
Page 1
    • kingstreet
    • By kingstreet 11th Oct 18, 1:27 PM
    • 34,488 Posts
    • 18,726 Thanks
    kingstreet
    • #2
    • 11th Oct 18, 1:27 PM
    • #2
    • 11th Oct 18, 1:27 PM
    The current valuation is 2m.

    What's the current mortgage balance?
    I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.
    • Suzidil
    • By Suzidil 11th Oct 18, 1:39 PM
    • 4 Posts
    • 0 Thanks
    Suzidil
    • #3
    • 11th Oct 18, 1:39 PM
    • #3
    • 11th Oct 18, 1:39 PM
    We have the Agreements in Principle from two highstreet banks and have not bought the house yet.
    • richardjmcdougall
    • By richardjmcdougall 11th Oct 18, 1:46 PM
    • 11 Posts
    • 5 Thanks
    richardjmcdougall
    • #4
    • 11th Oct 18, 1:46 PM
    • #4
    • 11th Oct 18, 1:46 PM
    Buildstore offers finance that could possibly suit you, also peer 2 peer AssetzCapital could be worth trying.
    • DCFC79
    • By DCFC79 11th Oct 18, 7:22 PM
    • 33,139 Posts
    • 20,866 Thanks
    DCFC79
    • #5
    • 11th Oct 18, 7:22 PM
    • #5
    • 11th Oct 18, 7:22 PM
    Buildstore offers finance that could possibly suit you, also peer 2 peer AssetzCapital could be worth trying.
    Originally posted by richardjmcdougall
    I would treat this with caution OP.

    Obviously check them out.
    • LRmortgage
    • By LRmortgage 11th Oct 18, 7:37 PM
    • 103 Posts
    • 25 Thanks
    LRmortgage
    • #6
    • 11th Oct 18, 7:37 PM
    • #6
    • 11th Oct 18, 7:37 PM
    If you are purchasing for 2m, how much of that is the Barclays mortgage and how much is your deposit?
    • Suzidil
    • By Suzidil 11th Oct 18, 9:22 PM
    • 4 Posts
    • 0 Thanks
    Suzidil
    • #7
    • 11th Oct 18, 9:22 PM
    • #7
    • 11th Oct 18, 9:22 PM
    Our deposit will be 300K for 85% LTV.
    • Thrugelmir
    • By Thrugelmir 11th Oct 18, 9:35 PM
    • 61,340 Posts
    • 54,575 Thanks
    Thrugelmir
    • #8
    • 11th Oct 18, 9:35 PM
    • #8
    • 11th Oct 18, 9:35 PM
    Our deposit will be 300K for 85% LTV.
    Originally posted by Suzidil
    What security can you offer for funding of 500k. There's no market for speculative finance. What you consider the property to be worth in the future once finished has no bearing on the decision.
    Financial disasters happen when the last person who can remember what went wrong last time has left the building.
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