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How do I work out affordability of remortgage before talking to my bank?

(6 Posts)
alltheworld Fri 12-Feb-16 20:33:11

I have had my mortgage for 17 years. Itisa goodtracker so I don't want to give it up but I do want to extend the term and also increase the borrowing to fund a loft extension. I spoke to an IFA who said my best bet was to talk to my bank and that my bank had a policy of not dealing with intermediaries. How do I work out what I can afford as I don't want to be turned down. I guess most brokers won't be interested in me as there would be no commission for them but I would gladly pay for advice

Rockchick1984 Fri 12-Feb-16 23:52:19

Go in and speak to your bank, they will be able to tell you a few examples if you have an idea what you can afford or what you would like to borrow.

If you are looking to extend the term it's unlikely you will be able to keep the same deal unless they are still offering it. If it was just the extra borrowing, some lenders will put that on a separate loan rate but others will make you transfer the whole amount to a new deal.

alltheworld Sat 13-Feb-16 23:06:30

Thanks rock chick.
A few years ago, my bank told me I would have to remortgage everything if I wanted additional borrowing but then backed down and said only the additional borrowing would have to be on a new rate.
I spoke briefly to an IFA who said I could extend the term of the original mortgage if the extension was on a new rate.
So I am a bit confused!

YoniMitchell Sat 13-Feb-16 23:13:45

We borrowed from our mortgage lender for an extension last year and instead of changing our existing mortgage (extending the term or increasing the amount) they just opened a separate loan agreement. It meant we kept the v good deal we already had bit could borrow the secondary amount separately.

YoniMitchell Sat 13-Feb-16 23:15:41

If your current mortgage is at a good rate extending it would likely prompt your lender's current rate. Would that be better? If not then it would be better to apply for a second loan/mortgage extension on that basis.

alltheworld Sat 13-Feb-16 23:18:17

Thanks yoni, that makes sense for the extension bit.
The trouble is that I also needtoextend the original term if I am to afford the additional borrowing. I have a lot of equity in the house.

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