Mortgage Sorter
Recommended UK Mortgages

Renovation Mortgages

Buying a property in need of renovation and doing it up is increasingly popular - whether it's for investment or to create your dream home.

The problem is that most mortgage lenders require a property to be 'habitable' before they will secure a mortgage on them.

What's Habitable?

Habitable means that a property is fit to live in. This is defined as:

  • Watertight - roof in good repair


  • Running water & mains electricity


  • Basic kitchen and functional indoor bathroom (outdoor toilets don't count!)

The 'habitable' requirement leaves many buyers in a catch-22 situation - they can't renovate without a mortgage, and they can't get a mortgage before the renovation is complete.

Renovation Mortgages

Fortunately, some lenders do offer mortgages designed specifically for people who are renovating.

These renovation mortgages are similar to self-build mortgages and work by releasing your mortgage funds in stages. Typical payment stages are:

      1. Initial purchase (just enough to allow you to buy the property)


      2. Property structurally sound and watertight


      3. All services and amenities in place - e.g. plumbing, wiring, heating, bathrooms


      4. Property decorated and finished

When each stage is complete, your property will be inspected by your mortgage lender's valuer, who will approve the payment for that stage. Stage payments are normally made in arrears - although there are a few lenders who will pay them up front.

Renovation mortgages normally require a deposit, although this can be as small as 5% - 10% of the initial purchase price.
 

 

Remortgaging for Renovations and Home Improvements

When you already own a property and want to have an extension or other improvement remortgaging to raise the required capital / money is a common way to fund this.

The first step is to have a word with your current mortgage lender.

See what they are prepared to offer you. Then compare this with what you could get by remortgaging with a new lender.

What you are looking for is the interest rate on the new mortgage, plus any fees involved in cancelling your old mortgage and / or arranging the new one.

An easy way to compare the different mortgages will be to get the lender to tell you what the monthly payments will be.

Ideally you should be going for a limited term mortgage eg 2 or 3 years - paying a fixed rate of interest. That way it should be easy to see what the total monthly cost of the payments will come to.

 

To read more on this subject please see the list below or your mortgage guide or your home buying guide

Read enough? Just want a quote? To get your best mortgage quote quickly and easily we can put you in contact with a recommended mortgage adviser. It's free, completely confidential and there's no obligation at all. Simply fill out the form below

Value of Property £  
    (eg 125000)
Borrow How Much? £
    (eg 92500)
Your Morgage Type

 

 

 

Read On

Types of UK Mortgages

Repayment mortgages

Interest only mortgages

Interest repayment arrangements

Complete A-Z of mortgages

 

Read On / Mortgage Guide

Mortgage Basics

Choosing a Mortgage

Different Mortgage Types

Re Mortgages

How to Find your Mortgage

Mortgages in Principle

Costs of UK Mortgages

Mortgage TOP TIPS

Mortgage Calculators

A to Z all UK Mortgage Types

 

Read On

Guide to Buying Home in the UK

Guide to UK Home and Mortgage Insurance

Life Insurance Guide

Glossary of UK Mortgage Terms

Mortgage News

 

 


 

Get a custom rate and see
how much you could save by
filling out this quick form
below.

It's a FREE, no-obligation service.

Value of Property
£
 (eg 159000)
Borrow How Much?
£
 (eg 125000)
 Your Morgage Type
   











Browse over 200 Free Mortgage Tips

Your Complete Guide to UK Mortgages
Find Out How to Win the Race to Buy Your Home - Home Buyers Guide
How to Sell Your Home
Learn How to Save ££s by Remortgaging
Read the Insider Info on Home Insurance
Best Buy UK Mortgage Tables
UK Mortgage Calculators
First Time Buyers
Self Employed Mortgages
Bad Credit Mortgages
Overseas Mortgages
Common Questions / FAQs
Mortgage Definitions
Mortgage Lenders UK List
LATEST MORTAGE UK NEWS

Site Help

About Us
Your Privacy
Contact Us
HELP
Mortgage Guide Site Map
Tip Our Charity






Social Bookmark Us (Please ;-))
























 

 

 

 

 

FREE MORTGAGE QUOTES
Call 0845 22 33 112
or Apply Online Fast and Easy
 
Great Selection of
UK Mortgage
CALCULATORS

Click here
  
See Today's Latest
Mortgages
BEST BUY TABLES

Click here