Strap yourself in for a relatively complicated one!
Outstanding mortgage amount £131k
Purchase price of house - £300k
Value of own house £285k
The best mortgage deals are 50% LTV. We could use savings to move into the new house and keep the exactly the same mortgage amount.
However, we would want to extend and I've been quoted £80k. This would obviously increase our LTV but we expect the house to be worth at least £400,000 after the extension.
We could get a no ERC mortgage to borrow enough for the extension but that assumes we could remortgage again to get another one once the work is done to get the repayment figures down due to LTV.
Is that a stupid idea?
We have £70k in savings so don't need to borrow a massive amount (although I would want an offset and keep some liquid cash in the offset savings account for a rainy day but not have to pay interest on it).
We would live in this new house forever once it's extended if that makes any difference?