If you require additional finance for your home improvement or upgrade project there may be several options available to you. The most common options are as follows:
Rates can vary widely from lender to lender so it is important to shop around for the best deal. Look out for additional benefits such as the ability to make overpayments without paying a penalty.
CAPITAL RAISING ON A MORTGAGE
Raising capital on your mortgage will depend on the level of equity you have in your home, remember the improvements you are making should result in an increase in the value of your property and this should be taken into consideration by the lender. If you are improving the energy efficiency of your home, look out for ‘green’ lenders who may offer special discounted rates.
If you have a current mortgage you could approach your existing lender to add a Further Advance to your mortgage. This would add the home improvement loan amount to your existing mortgage balance and would be paid back over the remaining term of your mortgage at the current rate.
Alternatively, you might save money by remortgaging with a new lender borrowing sufficient to pay off your existing loan plus the amount you need to make the planned home improvements. Again you should shop around to make sure you are getting the best deal. We have partnered with an Independent Mortgage Adviser who can ‘shop around’ on your behalf making sure you get the mortgage most appropriate for your needs at the best rate available.
If you are lucky enough to be mortgage free you can still take a Capital Raising Mortgage. This is simply borrowing the amount needed for the home improvements in the form of a mortgage.
You should be aware that borrowing money against your home means that if you do not keep up repayments on your mortgage your home could be repossessed. It is therefore important that you only borrow within your means. Speaking to an Independent Mortgage Adviser will help to safeguard against this as they will confirm suitability before making any recommendation.