Mortgage for renovation

[photo123]

Hi, does anybody have any info on mortgages for a house requiring renovation ie. electrics, plumbing, roof repair,

Sorry,posted above by accident without finishing.Could we apply for a normal mortgage or would a self build be more appropriate as we would have to borrow funds for the renovation work. Has anyone else done this (major renovations)?

 

[Hel_n]

Yes you can borrow money to renovate a house that you are purchasing. Usually the lender offers 92% of the pp and up to 100% of the cost of improvements, provided that the home improvements increase the value of the house.

For example:

PP 200K
Renovations 50K

Loan available 184k to purchase

 

[Hel_n]

Yes you can borrow money to renovate a house that you are purchasing. Usually the lender offers 92% of the pp and up to 100% of the cost of improvements, provided that the home improvements increase the value of the house (usually a minimum of of 90%-92% of the value of house on completion). 92% of the pp is released upfront and the rest at stage payments as the work is carried out.

For example:

PP 200K
Renovations 50K
Fianal valuation €260k

Loan available 184k to purchase
50k for renovations

 

[photo123]

Thanks Helen.do you know if all the banks offer this and is the extra money borrowed charged at usual mortgage interest rates?

 

[Hel_n]

I think I made a bit of a mess explaining that but you seem to have understood what I was trying to say!

I know First Active do it and so do IIB, PTSB also do it (and I know of cases where they have done it with 100% mortgages so they funded the full purchase price and home improvements - restricted to FTBs though). You could enquire with other banks as I'm sure they would do it too. Really the main thing from the banks point of view is that the overall value will be increased as a result of these works.

The extra money is charged at the same interest rate and over the same term (unless of course you opted to split it - maybe to pay off the home improvement part quicker).