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How to fund a house extension?


marzman

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Hi all,

 

...Fairly interesting weekend for us. We have lived in the same rented house for the last 7 years, and earlier this year decided to start thinking about buying somewhere. For my initial budget of £200k, there was really very little around that I liked the look of, so we decided to put plans on hold, wait another couple of years (to get a bigger deposit), and then look for a £300k house.

 

However, the house next door-but-one went up for sale yesterday for £200k, and it's the corner plot in a nice area, with a bug piece of land.

 

I've spoken to the owner and we are extremely tempted, but my problem is this:

 

The house as it stands is the same size as where we are now but we wanted to take a step up the ladder. It will take me probably 6-10 years to save up the £50k needed for an extension. However i could simply go out and buy the £300k house instead, and be in the bigger house relatively quickly.

 

So what are my options to raise £50k for an extension? The cost of mortgage/repayments is not the issue, it's the speed at which i can raise the money.

 

i'm assuming the options are only Mortgage or Personal Loan, but i dont know if either can actually be done in the real world? Does anyone have any experience?

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Make sure you confirm that you can build an extension there first, before you get too far down the road.

 

/VOE

 

Yeh.... So to do that i'll need to buy the house first, then apply for planning permission, and then see if i can remortgage? Guessing thats not possible...

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Make sure you confirm that you can build an extension there first, before you get too far down the road.

 

/VOE

 

Yeh.... So to do that i'll need to buy the house first, then apply for planning permission, and then see if i can remortgage? Guessing thats not possible...

 

Contact your council planning office. They'll have what they call a "One stop shop".

Whilst this isn't actual planning permission, you can send them an outline of what you would like to do and they'll let you know if they think there would be any issues.

 

This in no way guarantees permission though.

 

I've just been through all this process and it took some time to get it all right.

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maybe that's the way to go, see what sarnie says, I know when I was looking at it the loans interest ended up being quite high so was better for me to borrow against my current mortgage and had an answer the same day about approval.

Or borrow more initially to cover it?

Edited by jumping350
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As long as you're under about 85%LTV, you should be okay to borrow enough. If you're over that, then don't even bother looking any further, as interest rates will be crippling.

 

That's 85% LTV of current value as well remember not the post work value.

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You would need planning permission for either a single or two (or more) storey extension on the side of a house fronting a road.

 

Can't stress enough the need to check with the planning authority as to whether they would agree - some are fairly laid back but with others it is a no-no on principle. Yes, there is an appeal route if you get rejected but win rate is only around 35%. Trawling through the register of applications and/or spotting recently built extensions similar to what you are looking at will help to reveal if you are likely have an uphill struggle, or not.

 

So if the extension is vital to your needs you must check that out as far as you reasonably can as a vendor is unlikely to wait while you get plans drawn up and than application decided - allow 12 weeks minimum knowing Local Planning authorites often exceed their published targets for deciding applications.

 

You could involve a local Chartered planning consultant (my profession before retirement) who is likely to know if you have some hope or otherwise (or indeed other alternatives ;)) as I would advise extreme caution about any advice you are given by the duty planning officer you may see at the Council offices. All too often their outcome predictions do not materialize and even though charges are normally levelled for pre-submission advice it is on a 'without prejudice' basis.

 

If you need any more informal advice feel free to pm me Chris. :thumbs:

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If its on a corner plot with a big bit of land my first option would be, knock it down and build two, sell one and you will probably end up near enough mortgage free and a nice new house built to your size and spec.

 

If that doesnt work out, go for the extension.

 

I know there a lot of ifs and buts, but that is the route i would go down, best case scenario to worst case scenario.

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