To release more equity

[blueberry23]

Really undecided on what to do here.

Increasingly aware that DH and I are nearing 40, we still have 250k to pay on our mortgage, but we desperately need another bedroom and want to release another 40k to make that happen.

For context, we have completely renovated the house and gone from having 30k equity when we bought it to roughly 250k equity now, in less than 10 years.

But you never actually see that money do you? So it doesn't feel like we have made 220k, as we would likely upsize if anything.

Happy where we are for another 10 years - if we had the extra bedroom.

Should I just not worry about the huge debt and go for it? We can afford the monthly repayments.

Is it common to be nearing 40 and still have circa 250k-300k of debt?! We'd be looking at a 25 year term when we remortgage and release the 40k.

It would also increase the house's value by hopefully the same amount (if not more).

WWYD?

I should clarify the reason I've said 'more' equity is because we've done this twice before to do home improvements - which had doubled the value of our home so it's been more than worth it (it was basically derelict when we bought it and is beautiful now).

Equity release which adds to the value of your home (and so technically keeps your equity in the house the same or improves it), as opposed to for consumption, seems quite reasonable.

I think at this age the most important thing in financial planning is to make sure that you are on track to have a decent pension as well as a paid-off house you're happy to live in for the long term, towards retirement age.

If you're paying down your house but not saving for a pension, you are likely to end up being forced to move to get cash. If you're building a pension pot or have a defined benefit pension but won't have your own home (unable to buy, interest only mortgage, or repeated upsizing) then you are at the mercy of the housing market when you need somewhere to live in old age.

Please also be aware that mortgage advisors for banks are usually quite happy for you to keep increasing debt as they will be getting more of your money for longer. They are not a neutral advisor.

Haha - my mortgage is 3x that. So no, not unusual to have that much mortgage remaining IMO.

If you think the work is necessary and you can afford it, why not I guess.

46 and 50 here and just increased mortgage to 262k to do an extension. We won't be leaving this house, but it's not unusual to do something like this in your 40s.

If you’re planning on staying and it improves your home then do it. I released 30K for home improvements and don’t regret it at all. I don’t owe as much as you but if you can afford the repayments then just do it.

If you think you will stay in the house then it’s a no brainer. If you were to move you would have stamp duty and moving costs.