Thinking About Home Improvements? Let’s Talk Additional Borrowing!
Dreaming of a new kitchen, an extra bedroom, or even a garden office?
If you’re looking to fund your home improvement project, additional borrowing on your current mortgage (also known as a further advance) could be a smart option. I drive my partner nuts as I trot past him with a drill or a paint brush, but it can add significant value to your home!
What is a Further Advance?
A further advance is when your current lender agrees to lend you extra money on top of your existing mortgage. This can often be a more affordable way to borrow compared to personal loans or credit cards, thanks to lower interest rates.
How It Works:
Equity Check: Your lender will assess the value of your home and how much equity you’ve built up. The more equity you have, the more you may be able to borrow.
Affordability Assessment: Just like when you first got your mortgage, lenders will check your income, expenses, and credit history to ensure you can afford the extra repayments.
Separate Loan: The additional borrowing is often treated as a separate loan, which may come with a different interest rate or term.
Is It Right for You?
Planning renovations that could increase your property value? A further advance can be an investment in your home’s future.
Need a manageable repayment plan? Mortgage terms are longer, so your monthly costs may stay affordable.
Have a fixed-rate mortgage? Check for early repayment charges or restrictions before proceeding.
Things to Consider:
Your overall debt will increase, so make sure it fits within your long-term financial plans.
Always compare the cost of a further advance with other options, like personal loans or remortgaging.
Pro Tip: Certain improvements, like adding a loft conversion or upgrading your energy efficiency, can significantly boost your property’s value—making your investment work double for you!
Ready to turn your house into your dream home? Let’s explore your options for additional borrowing. Drop your questions in the comments or send us a DM for personalized advice!
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