Remortgaging for home improvements

[Wigeon]

We are shortly going to be building a kitchen extension and financing it using a combination of savings and re-mortgaging when our current deal runs out (soon). We are lucky enough to have plenty of equity in our house so hope the actual remortgage won't be a problem and have an IFA who is very helpful in finding us good deals.

But can anyone tell me how it actually works when you borrow additional funds for home improvements - do they give you the money for your home improvement in a lump sum, or in installements, or what? Do they ask you for specifics about the home improvement you are planning or do they just give you the dosh (subject to all the usual credit checks etc etc). Have searched the mumsnet archives and done some general googling but can't seem to find the answer. Any info gratefully received!

I've done this a few times. If you're remortgaging and you aren't borrowing anything like 60% of the value of the property you simply request a new amount. I've never been asked what the extra money's for. They'll probably do a simple valuation of the property to make sure it's worth what you say. If the old mortage is £100k and the new mortgage is £125k they use the first £100k to redeem the old mortgage (give or take a few fees) and send you a cheque for the balance.

Thanks very much for your reply - that's very interesting that you could just borrow the extra money for anything you like (presumably a round the world cruise, or to buy a race horse, or anything?). Also reassuring that it's pretty straightforward as long as the value of the property issue is fine.

Now we just need to make final decisions for the kitchen extension on appliances, taps, tiles, flooring, position of sockets etc etc etc! That's a whole nother thread!

Years ago I added £5k to the mortgage to do the bathroom up, they sent a bloke round to take a look at it to check it would add sufficient value to the property, he said yes, got the money in one go a month or so later. I presume they did credit checks etc as well although I think all I did was over the phone.

If you are getting it as a mortgage ie increasing your overall mortgage rather than getting a secured loan then I would think it would all be in one go - when people get money in stages I think it tends to be because the work is needed to make the house fully mortgageable / in good condition, like repairs etc.

Have fun designing your kitchen!

Sorry not to acknowledge sooner - DD1's 3rd birthday on Saturday and party today got in the way!

Thanks for your thoughts KirstyJC - very helpful again.