Using mortgage “budget” for renovations?

[GorgeousLadyofWrestling]

How does that work?

Just watching Location, Location, Location and Kirsty has said the house is on for 250k which leaves the couple room in their budget for renovations from their top budget of £300k.

is this true - is this how it works? When we bought our place, we had a MIP of one amount but when we put an offer in and got the AIP - it was for that total amount of the offer we put in. There was no actual physical cash available to us from the MIP amount. It was just “here’s the offer for the amount you need.”

Is this what other people do - can you take out a mortgage bigger than the property amount (presuming affordability is there, obviously)?

No, it sounds like they had a big deposit.

So maybe they had 100k equity and could borrow 200kmax (AIP). Total budget 300k.

If they buy somewhere that is £250k, they will still borrow the max 200k, use 50k equity and then 50k equity left for Reno.

We did what @BakeOffRewatch said. Large deposit but got a higher mortgage as we factored in a loft extension.

We told the bank the purchase amount and how much we wanted as a mortgage. They didn't question why we wanted £30k more than needed. As long as your loan-to-value ratio is fine you can borrow. more.