Moving house, I’m being really stupid here

[SisterAgatha]

Having a think about moving, trying to figure out if it’s worth it, what we might be able to afford if we did move, or if it’s just worth getting a loft extension.

Current house worth £370. Still owe £250 on it. If I can borrow up to £180, does that make my total borrowing amount £300 plus whatever deposit we would have? Which is less than what our current house is worth? I don’t get this bit and I can’t remember how it worked last time we moved (2006)

An extension would be about £45k so if the situation is that we can only afford a house worth less than we currently have, I’d rather extend.

Sorry for being a bit silly tonight!

Not quite - the house price you could go for would be £300k - the £120k equity you have plus £180k mortgage (plus whatever extra savings you may have to put down)

You wouldn't be able to borrow £300k, only £180k as you said. I'm sure this is what you mean but I feel you've worded it wrongly in your OP!

Yes oops! that’s what I meant, total amount to spend being £300, not total borrowing!

Seems mad, right? I think the extension sounds like a better plan.

Do you mean £180 MORE than the £250? Or has you circumstances changed so you can only borrow £180 now? If the latter then it's what @GordonBennett20 said.

No, this is all pie in the sky at the moment. I’ve done a quick calculator on our current wage and it’s £180 max borrowing. So after the £250, our change would give us £300 including the £180.

The problem is that the house hasn’t gone up as much as in other areas, we borrowed more for home improvements, my wage has gone down and we had a large deposit saved when we bought our current house.

Today you have equity of £120 but assume you started off with a larger mortgage, than £180k? Borrowing criteria has changed since 2006 so yes mortgage raising maybe tighter, many people would not get the same mortgage now as they did pre banking 2008.

And you will need to factor in £10-20k for solicitors and moving costs as well as fitting out the new place. I always forgot that but when calculating my next house move 😫