Mortgage to extend
Discussion
Hi All,
We live in a 3 bed semi in the NW of England.
Have considered moving a few weeks ago but bottled out at the last minute. Like where we are and 2 of our 3 young children were born in that house, neighbours are great etc etc - so decided to stay and extend from 3 beds to 5.
I work in construction and have calculated how much i can extend for to be around £50k. Mrs has picked all the new furniture and decor at around £10k.
Our house is currently worth around £140-150k. And we owe around £100k on it with 18 yrs to go on the mortgage. Wife has done some calcs today online and the money is fine, can afford the addition spend, on circa £50-55k additional lending.
However, just spoken to the provider now who has said they'll only lend us £27.5k as they believe the house to be worth more like £140k and obviously lending us £55k when we owe £100k already would mean we could take the money and run - in theory.
So, that's that one quashed.
Is there anything we can do? I reckon with the extension and all the other work we could do with the additional borrowing, and based on a house that sold recently round the corner for over £230k with similar modifications to it, obviously their £160k would be safe and we'd be in positive equity still - but obviously it's just additional lending and they don't know the spec, size, quality of the extension or finishes that we'd do. So they're saying no.
I'm consider shopping around but chatting to the wife, looks like it could be a similar story elsewhere with all lenders very nervous right now.
Is there anything we can do?
Surely self-build mortgages are something similar to what we're looking for? Or is it just not the time to do it unless you've not got the cash?
We live in a 3 bed semi in the NW of England.
Have considered moving a few weeks ago but bottled out at the last minute. Like where we are and 2 of our 3 young children were born in that house, neighbours are great etc etc - so decided to stay and extend from 3 beds to 5.
I work in construction and have calculated how much i can extend for to be around £50k. Mrs has picked all the new furniture and decor at around £10k.
Our house is currently worth around £140-150k. And we owe around £100k on it with 18 yrs to go on the mortgage. Wife has done some calcs today online and the money is fine, can afford the addition spend, on circa £50-55k additional lending.
However, just spoken to the provider now who has said they'll only lend us £27.5k as they believe the house to be worth more like £140k and obviously lending us £55k when we owe £100k already would mean we could take the money and run - in theory.
So, that's that one quashed.
Is there anything we can do? I reckon with the extension and all the other work we could do with the additional borrowing, and based on a house that sold recently round the corner for over £230k with similar modifications to it, obviously their £160k would be safe and we'd be in positive equity still - but obviously it's just additional lending and they don't know the spec, size, quality of the extension or finishes that we'd do. So they're saying no.
I'm consider shopping around but chatting to the wife, looks like it could be a similar story elsewhere with all lenders very nervous right now.
Is there anything we can do?
Surely self-build mortgages are something similar to what we're looking for? Or is it just not the time to do it unless you've not got the cash?
You won't currently get a "standard" mortgage that will allow you to borrow more than the house is worth, and every lender will lookat its current value rather than its future value.
There are mortgages related to selfbuild that might be able to help.
It will largely depend on what your place will be worth when its done.
You'll need pretty good plans and costings though. Back of the envelpe ideas wont cut it.
Oh and working in construction, especially if you are self employed could go against you.
ET make things a bit less confusing.
There are mortgages related to selfbuild that might be able to help.
It will largely depend on what your place will be worth when its done.
You'll need pretty good plans and costings though. Back of the envelpe ideas wont cut it.
Oh and working in construction, especially if you are self employed could go against you.
ET make things a bit less confusing.
Edited by scotal on Wednesday 25th January 13:51
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