There are many reasons why people choose to remortgage their properties, one of the most common being is home improvements. Home improvements can get quite expensive and demand a lot of money out.
Especially if you have growing family extra space is always needed adding a loft or rear, side extension will give a lot more space.
When you remortgage for home improvements, you are saved from adding to your debt burden by borrowing more funds against your property with your existing mortgage. This free mortgage advisors harrow can provide you with the best deals on the market.
So, how can you remortgage for home improvements?
How should you remortgage for home improvements?
As Mortgageable.co.uk suggests the process of remortgaging for home improvements is the same as carrying out a regular remortgage. You need to get in touch with your mortgage broker for remortgage and additional funds application.
If you are planning to switch to a new mortgage lender or stay with the same lender, you will have to give valid reasons to your borrowing application is successful.
Once the application is submitted your lender will make necessary assessmentsof income and affordability, planned home improvements with additional details like planning permissionand if they are happy you will have mortgage approved.
To ensure smooth remortgaging of your property and obtain the best deals in the market, it is advisable to work with an experienced local mortgage broker. A skilled remortgage broker will scan the entire market to get you deals that suit your requirements and circumstances.
Some brokers like MariannaFS also provide fee-free services, helping you save a hundred of pound as you remortgage your property for home improvements.
Important factors to consider while remortgaging for home improvements
Before you make a proposal for remortgaging your property for carrying out home improvements, here are some of the most important factors you should consider:
The cost of home improvement
The most important factor that comes into play during such situations is the cost of making home improvements. Discuss the estimated cost as you approach your lender for remortgaging your property. The lender would assess the costs involved and approve your proposal for a remortgage accordingly.
As you calculate the cost of home improvement, make sure you take into consideration every little expense and keep a contingency fund for unexpected circumstances. This would provide you with a clear idea about the costs involved in making home improvements. It is also important to discuss these costs with our remortgage broker as they would help you find deals in the market that would benefit you the most.
To remortgage your property for home improvement, your lender will check your affordability of new loan repayments. Underwrites will look at your financial position and check your affordability to make sure that you would be able to repay the mortgage after carrying out home improvements. Ideally, lenders look at your income, regular expenses, and existing debts before approval.
Your credit history
Just like getting a mortgage for the first time, your credit history will play an important role as you remortgage for home improvements. If you choose to stay with the same lender, they would be more lenient in making credit checks for the remortgage. A new lender will be a little stricter in making checks but you wouldn’t have to worry if your credit hasn’t been hampered since you took your first mortgage.
Types of home improvements you can remortgage for
Although the exact circumstances are unique for every individual, here are some of the most common types of home improvements for which you can remortgage your property:
House extension involves adding more space to within or around your house to expand your property. Extensions can get really expensive and can cost you a lot more, making homeowners remortgage the property instead of taking a fresh loan.
Many homeowners choose to convert their lofts to have more room on the property. You may want to convert your loft into an extra bedroom, a library, or a small dedicated office for working remotely. Depending on your specific requirements, the costs of a loft conversion can be expensive. This makes remortgaging your property a better option for securing funds to convert your loft.
If your property needs to be renovated and you are thinking to give a new look to your home, adding new kitchen or have a new bathroom all this plans could cost a lot of cash. The funds for the home renovation can be raised via remortgaging.
Should I remortgage my property after making home improvements?
If you have sufficient funds to afford to make home improvements and the improvements would add value to your property, it is advisable to remortgage after carrying out the improvements. As the value of your property would increase, you would be eligible for a better remortgage deal, helping you cover the home improvement costs effectively. This is because greater property value would reduce the LTV (loan-to-value) ratio and help you get a new mortgage at a lower rate.
Before you remortgage for home improvements, always make sure that the expenses are high enough for you to get a new mortgage. Also, discuss the prospects with experienced mortgage advisors and mortgage brokers before you make a final decision. Get yourself a remortgage only if you are getting a good deal that would cover all your expenses. And always remember to take advice before securing loan against your home. You may lose home if you don’t make payments.