How do you finance a renovation?

Snakeweasel

I am in a very fortunate situation whereby I have a site on our family farm, but I also live in a cottage on the farm rent free.

I was looking at extending and renovating the cottage, as this would be my preference over another new build on our small farm, but it dawned on me, can you actually get a mortgage for a renovation/extension project like this?

I wouldn't want to get in to the planning process only to learn that my only option to do the work would be cash/personal loans.

blindside88

It can generally be done with a standard mortgage. They base the amount you can borrow on the expected value of the property once renovations are complete and will pay the funds in stages similar to a new build (subject to affordability). Your first port of call should be to a mortgage broker to see the viability of a mortgage application before speaking to an architect. Once you know how much a bank is likely to loan you you can give your architect an estimate as to what he has to work with

Claw Hammer

You will have to be the registered owner of the land the cottageis on to get a mortgage to start with. The banks will want a minimum drawdown and architect/engineer supervision.

Snakeweasel

Thanks guys, I couldn't find this info online, anyone I saw reference a mortgage for a renovation online, had bought the property so the renovation would have been part of the mortgage for the purchase. I was worried I would be laughed out of a brokers office!

jamesdave

Thanks for sharing the information, quite helpful. Not much data is available online regarding finance and renovation matters.