Bluebell Mortgages
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    Bluebell Mortgages are expert mortgage brokers and have a detailed knowledge of mortgage lenders’ and first time buyer mortgages.

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    We can inform you of all the likely fees associated with a house move, identify your current position and calculate your likely required loan amount.

    Remortgaging

    If you already have a mortgage and your current deal is due to expire in the next 6 months, we can help find you the most effective deal for you.

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    We have a vast experience of the Buy To Let market and are able to offer our clients detailed advice on the correct method of funding potential purchases.

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    An effective way for first time buyers to get on the property ladder, it can considerably reduce the amount needed for a deposit.

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    Bluebell Mortgages have specialist advisors who can assist you with your first or next commercial or self-build development.

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Considering a remortgage to fund home improvements?

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Considering a remortgage to fund home improvements?

As we move deeper into Spring, the weather is becoming more pleasant and many of us will be thinking about making improvements to our homes. Yes, the DIY and home improvement season is upon us. But do you know how you can raise the finance?

Many homeowners remortgage to fund home improvements because interest rates tend to be lower than on personal loans or credit cards.1 But remortgaging will depend on your property, your existing mortgage loan, and your current financial situation. Whether it’s a new bathroom, kitchen, loft conversion or extension, you’ll need to think about the best way of funding your home improvement project.

Important things to consider when remortgaging to finance home improvements:

Affordability: if you increase the amount you are borrowing on your mortgage, your monthly payments will rise. Before agreeing to a remortgage in these circumstances, the lender will check your income is high enough to afford the new payments after all your other outgoings have been deducted.

Cost of the home improvements: It’s very important to consider the cost of your proposed home improvements, and whether you can finance the amount required from a remortgage. A lender will consider the cost of the home improvements in their assessment to give you an idea of the amount that you will need to get from remortgaging.

Credit history: Your credit score is a primary factor in the lender’s decision whether to approve your remortgage. It pays to do some homework beforehand to understand how lenders see you and your credit status to avoid any nasty shocks later in the application process.

Equity: A lender would be unlikely to approve a remortgage deal if you are in negative equity, i.e. if your property value has fallen since purchase. Although generally UK property prices have continued to rise in recent years, it is an important detail to consider before proceeding.2

Financial circumstances: When obtaining a remortgage, whether it’s a new deal with your existing lender, or a brand new lender, your financial situation will be reassessed and details such as late or missed mortgage payments may result in lenders turning down your application. Those lenders that accept borrowers with mortgage payment issues may charge higher rates than mainstream lenders.

Type of property: Consider whether your home improvements will add value to your home. A local estate agent can help you assess whether you will see a return on your investment if that’s important to you.

5 Reasons to stay in your home and carry out home improvements:

You could add value to your property
Create more living space
Stay in your current location
Stay near to schools
You could save money on the cost of moving home
If you are considering a remortgage or the alternative of a second charge loan, as a means of financing your dream home improvements, please get in touch and we can look at your situation and advise the most suitable course of action to take.

Sources

Sproson, K. (2022) Should you remortgage?. Available at: https://www.moneysavingexpert.com/mortgages/why-remortgage/ (Accessed 25th April 2022)
Bown, J. (2020) Understanding Negative Equity – and how to get out of it. Available at: https://www.moneysupermarket.com/mortgages/negative-equity/ (Accessed 25th April 2022)

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