5 year term or not (want to do borrow more in that time)

[Beltloop]

we need to remortgage soon. I would like a 5 year term but also in that time we need to do a kitchen extension and possibly loft conversion. I had planned to fix for 2 years then after that get a new deal and borrow an extra £50k for the building work. But now I’m worried about the state of things and would rather fix for 5.

Is there a way that a mortgage company would lend us an extra £50k in the middle of our mortgage term?

we can’t borrow more at the moment as not ready for the building work. I’m hoping we will be in a couple of years.

Thanks

You can fix your current outstanding mortgage for 5 years and when you are ready to do the additional work in 2 years apply additional borrowing.

Yes you can borrow more but you want to time it so that the fixed rate ends at the same time on the additional borrowing as on the original amount. However, if you expect interest rates to go up significantly and can afford it borrow enough to do the work now. It will be cheaper.

Ok thank you. Would I end up with two mortgage accounts with two different interest rates? Or could the additional amount be added to the existing mortgage?

we can’t borrow more at the moment as not ready for the building work.

Why can’t you borrow the extra now? Then stick it in a higher interest savings account until you need it?

You can borrow more in the middle of a fixed term. You just can’t leave unless you pay the penalty.

I have additional borrowing and it shows as two different accounts and loans on my online banking, although they are linked behind the scenes.

The extra borrowing will be at the rate at the time. My main mortgage was fixed at 1.09% in January, 7 months later I took the additional at 2.24%. When I fixed the main bit I didn't anticipate needing the additional so soon - otherwise would have done at the same time as clearly more expensive plus another fee. Would also advise looking at borrowing the extra now or at least working out the extra cost at a higher rate, plus the fee (ours was £1k) I'm sure will negate the interest cost in between.

We need to do a loft conversion to get extra study space and hadn’t realised you could do this. We were waiting until remortgage time but it might make sense to do it sooner. Annoyingly, there doesn’t seem to be any online rates for our bank so you need to speak to them to see if it is an option.

Thanks everyone. This is very helpful.

i don’t think we can borrow the extra now…we haven’t even started getting designs/quotes from builders etc so wouldn’t know how much.

Plus I’m not working at the moment and I want to be before we borrow more money!