ok,
The reason you had to pay off your car loan to get the mortgage is the banks calculate your borrowing power on the amount of disposable income you have.
Roughly speaking they take your gross pay and subtract income tax, child payments, loans, basic bills, cost of living expenses etc and come up with a figure of sdisposable income which is the max you could save after paying all normal bills.
You can borrow a fixed multiplier of this. Obviously if you are repaying a loan, this can take up to 33%of your disposable income, even though the payments are only 5% of your gross earnings.
Now do you see how small payments can affect your borrowing power?
However, you now have a home which is undoubtedly worth more than all you debts and then some.
The banks will throw money at you.
Dont go for 2 seperate loans. Although a car-loan may have a smaller rate, the personal loan of 8k will be quite expensive. The more you borrow on a single loan the best rate you will get.
The best deal you can get is to go to your mortgage provider and take out a loan for home improvements. Spread the cost over 3 to five years, no more. If you plan to change the car in 3 years , then go for a three year deal. Over 3 years at 14k the interest should be around 1000euro.
This is at your homeloan rate and secured on your home.
Dont be tempted over 5 years, the interest in huge. You say you can manage to pay your father off and pay a loan, so you can definitely afford a three-year loan.
Remember, 3 years comes around quickly and before you know it you will be looking towards the end of the loan. Also, in 3 years time you may have kids or more kids etc and you will appreciate having no loan.
PS never go for a fixed rate loan. Or payment protection if you are in a stable job.