The Question
We have lived in our home for 10 years and have just welcomed our third child to the family. We need to expand the house to fit our growing brood, so we are drawing up plans for a side-extension.
It is estimated to cost around £70k including VAT but I am aware it could end up being more.
We are currently on a fixed-rate mortgage with HSBC with two years left to run and the rate is really low (in comparison to current rates) so we don’t want to remortgage.
Is there a way we can borrow against the home to fund the renovation? A friend mentioned we could get an ‘advance’? Would this be an option?
Joe’s Answer
Raising further funds against your home is an option. I would look at one of either two options:
Option one: Apply for a further advance with HSBC. This will not require your current mortgage to be repaid and you will keep your beneficial interest rate. It will also avoid you having to pay any early repayment charges.
Option two: If this is not viable with HSBC, you can look at taking out a secured loan – also known as a second charge mortgage. This will be with another lender. Historically, second charge mortgages come with more generous affordability criteria, however they also have higher interest rates and set up costs.
Getting advice from a mortgage adviser on this would be very beneficial.
Meet our expert
Introducing Joe Capon of The Mortgage Bubble, who is ready to answer your questions…
Joe Capon has more than 10 years’ experience in the mortgage industry. He set up The Mortgage Bubble in 2021 and it is now a multi-award-winning mortgage firm, which strives to deliver the best mortgage advice to its clients which meets their needs now and also in the future. If you have a question for Joe email our editor and she’ll pass it on to him – kate.saines@emap.com
