mortgage top up or term loan?

[staunton]

Hi all,
Would love some advice on our financial dilemma.
Are planning on renovating our home.
Builders quote is coming in at around 30k.
We have around 20k in savings on deposit at c. 4%.
However our mortgage rate is at ecb + 0.51%
Because of this rate would it make sense to go for a mortgage top up and make the extra payments onto our mortgage instead of into a higher interest loan?
Also in the budget heard that home improvement top ups are eligible for TRS for seven years which would be another advantage.
We would really like to clear this loan quickly and could prob afford c. €1100 per month to do so.
Is there any chance that we could lose our ltv rate as tbh our ltv would no longer be near the 50% it was when we remortgaged after a top up and the crash in house prices.
What do people think would be the best course of action in our situation?

Sorry for the convoluted nature of the post and any help/ advice as always much appreciated.

 

[WaterSprite]

Have a look at this thread re: top-ups. I don't know what other banks are like but NIB is flatly refusing all top-up business.

In any case, I can't imagine that any bank will allow a top-up at the same rate as your current tracker, so in essence you'll be getting an additional loan. If you are hell-bent on doing the improvements, then you'll may have to go for an ordinary loan (at higher rates).

Sprite

 

[Bronte]

That's a great rate you're on. A top up over say a 2 or 3 year term if possible would be the best option. Low interest rate and repaid quickly. Make sure you can get the loan before you commit to the builder.

 

[agapanthus]

Dont know what lender you are with but almost certain you will not get the top up at the rate you are on, in fact be careful that you are topped up into a new mortgage and lose your tracker rate altogether.