Can I borrow extra money on your mortgage for renovations?
Yes, you can borrow some extra money on your mortgage for renovation purposes in the UK. Some mortgage lenders will accept your mortgage application as additional borrowing if the purchase price of the property has increased.
Read about renovation mortgages in detail on our other blog.
What is a renovation mortgage?
You may not be able to get the kind of financing you want if you’re buying something that requires major renovations. You might consider getting a second mortgage instead. A renovation loan is usually used when you’re buying a property that needs some minor repairs. A loan for a home improvement project might require you to put down a larger deposit. Bridging finance is an option that allows you to borrow money while your house is being built. If you are interested in getting some additional amounts than the actual purchase price of a property, you can contact amortgage advisor who can help you with your loan application.
Can a first-time mortgage applicant get a renovation mortgage?
If you are a first-time buyer, it is difficult to get a renovation mortgage in the UK. But yes, it is possible to apply for a mortgage without having owned a house before. However, you’ll probably have to pay higher interest rates and fees on your purchase price because you haven’t had much experience managing your finances. It’s best to get financial advice from a known market broker.
What kind of funding can you use for your renovation?
If you are interested in getting a mortgage for renovation, the amount that could be approved by a mortgage lender depends on your creditworthiness and ability to pay the mortgage repayments. You can read more in our detailed article about mortgage renovation.
Why traditional lenders probably can’t help you with renovation finance?
Many home renovators and first-time developers make their first approach to their own bank, other high street banks or building societies. These are rarely the most suitable sources of funding for renovation projects. Unsympathetic to inexperienced applicants: high street lenders operate to strict lending criteria. Applicants without the required building/development experience are unlikely to get the green light. Pickier about properties: traditional lenders’ definitions of properties they classify are as unmortgageable include: “Any property valued at less than £50000 needs urgent attention. Properties with structural problems need repairs before they can be sold. Derelict properties are a bad investment because they require massive work before they can be rented out. Properties without a functional bathroom or kitchen need immediate repair before they can be sold, because tenants won’t want to rent them if there’s no toilet or kitchen.
How to get a mortgage on a “fixer upper”?
House renovation mortgages are different to normal mortgages. The main difference is you’ll borrow both the money for your house and the cash to perform renovations. You’ll need to make sure the property is sound before applying for a loan. Most banks won’t lend money if there are any issues with the structure or the land. Derelict buildings require renovation before they’re livable again. Lenders won’t loan you money unless you’ve done your research first. You’ll need to do extra homework. There are a lot of potential problems and risks with a renovation loan. You need to be sure you have enough cash on hand to cover any problems that might arise. Renovations can be expensive, so make sure you budget accordingly. If you don’t have the funds to fix up your property, you should consider selling your current house instead.
Is it better to buy a new house and then renovate it, or to renovate an existing one?
It’s always better to buy a new property rather than renovate an old one. This way, you know exactly what you’re buying and you don’t have to worry about maintenance costs. On the other hand, renovating an existing property means you can save time and money. You can choose from a wide range of options when renovating an existing property based on the cost of renovation. You can either start from scratch or improve upon an existing design. A well-designed renovation will look good and last longer. If you are interested you can contact our team for a specialist renovation mortgage.
Can you include renovation costs in a mortgage UK?
Yes, you can include renovation costs in a UK mortgage. It depends on whether you are taking this additional borrowing for a purpose or personal use. For example, if you’re planning to live in a newly renovated property, you may be able to include renovation costs in your mortgage. However, if you plan to sell the property after completing the renovation, you cannot include these costs in the mortgage.
Which are the best renovation mortgage lenders UK?
There are various lenders that could help you with a renovation property mortgage in the UK but you may need some mortgage advice before starting your application. If the property is uninhabitable, some mortgage lenders won’t offer you additional borrowing on a renovation property.
Can I get a mortgage renovation project with bad credit?
If you have a poor credit history, you may not qualify for a renovation mortgage. Some mainstream mortgage lenders may ask you to provide proof of income and savings. They may also check your previous monthly mortgage payments, personal loans and credit cards. In addition, they may run a credit report to ensure you aren’t overstretching yourself financially. To apply for a renovation mortgage, you must meet certain financial criteria. These include having a minimum amount saved and being able to pay back the loan. You may also need to show evidence of regular employment.
If you are interested you can contact a mortgage adviser before starting your application.
