Is re-mortgaging your property for home improvements a good idea?
With the costs associated with moving home rising, coupled with the inevitable stress that goes hand-in-hand with moving, it’s hardly surprising that more and more people are choosing to adapt their homes so they’re more spacious and appealing, rather than selling up and moving.
If you’re thinking of making home improvements as a less expensive route to acquiring the home you are looking for without having to move, you may be exploring the different options of how you will fund the project.
Re-mortgaging a property is one way homeowners can raise the money to fund home extensions and renovations.
Many mortgage lenders are willing to extend an existing mortgage for home improvements. This can be a convenient way to secure the money required to build a conservatory, have an attic conversion, basement renovation, or other home improvement projects.
With interest rates currently low, homeowners can raise the value of their mortgage without having to struggle with significantly high mortgage repayments. However, it is important to be aware that if mortgage rates rise, as they are expected, so too would monthly mortgage repayments, meaning an extension project today could be considerably more expensive in two years’ time.
To make it easier to budget for and to give you peace of mind, you may want to opt for a fixed-rate interest mortgage, meaning you will know exactly how much you are required to pay for your mortgage for a specific number of years.
If you aren’t too keen to go down the re-mortgage route to fund your home improvements projects, the other option is to approach a bank or another lender to apply for an unsecured personal loan.
Such loans typically have repayment terms for a fixed term, usually five years or more. Like mortgages, some loans have fixed interest rates, making them easier to budget for.
Paying for the home improvements with a credit card is another option, which can be attractive for projects that aren’t too costly. Credit card contracts that offer low interest rates or a 0% introductory rate can be a more financially-viable way to fund home renovations.
If you would like to discuss any type of home improvement or interior refurbishment project, get in contact with Arti Construction, one-stop providers of high-quality construction and refurbishment projects for residential and commercial customers in London and beyond.