Can I remortgage to raise money for home improvements?

Providing you have enough equity in your home and can afford the repayments, remortgaging to pay for home renovations may be your best option. Releasing equity by remortgaging is extremely common due to the low interest rates compared to other forms of borrowing.


So, you love your home and don't want to move, but these ‘little ones’ are becoming less and less "small". Or maybe it's time for this brand new kitchen to drink wine and dine your friends? Playroom? Or want a home gym? Office? There are so many possibilities.

With a simple remortgage, you can easily, quickly and inexpensively raise money to renovate your home.

If you feel you cannot get a mortgage, we can recommend a mortgage Advisor. Our Mortgage Broker Leicester has years of experience finding the mortgage for you.

How much can I borrow?

You can borrow up to 6 times your salary if you have enough equity in the house, you can afford the payments and you have a high credit rating; but this is more extreme than the norm. We now live in a world of responsible lending, which is good, but it means that the answer to this question will be unique to your situation.

Each lender has their own criteria and will want to know more about your finances before deciding how much they will loan you. They will also need to conduct an appraisal of your property to determine the cost of the loan.

Some lenders may want to see a breakdown of the costs of the proposed job, but we can advise you on the specific requirements for your lender during your free consultation.

Your credit rating will affect the loan size and interest rate. The lower your estimate, the less you can borrow and the higher the interest rate will be. The higher your credit score, the better your options.

During your free consultation, we will review your equity, availability and credit rating so that we can liaise with lenders on your behalf. Our Mortgage Broker Leicester has access to the entire lender market, including some exclusive deals, so we can find the deals that best suit you.

Will the value of my home increase by the same amount I spend on improvements?

We tell our clients that any work performed, provided it is of good quality, can increase the value or ability to sell the property.

This does not necessarily mean that the value will rise by the amount you spend on improvements, but it should help your property sell its property anyway. The benefits of this should not be underestimated; getting stuck on a property that isn't for sale when you are trying to move can be extremely disruptive, limiting, and stressful.

With a few exceptions, we do not advise you to re-mortgage your home renovation solely as an investment. Do this because you need extra space or want to improve your living conditions. Instead of borrowing money to buy a larger or newer home and paying stamp duty and fees, it often makes sense to re-mortgage and renovate your current home.

In summary, the increase in value may not always be proportional to the amount you spend on improvements, but you can increase the value or ability to sell your property. But more importantly, you will enjoy a larger or newer home, and if you base your decision on that factor, you will always benefit!

Think carefully before securing any other debts against your home. Your home may be repossessed if you do not keep up repayments on a mortgage or other debt secured on it.  This is very important for fca regulations.

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