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Increase mortage to repay loan from family used to renovate house

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  • 18-02-2019 1:41am
    #1
    sami2015
    Registered Users Posts: 27 ✭


    Hi All,


    a friend of mine has come to me with a problem he has... he bought a house a few years ago and ended up borrowing money from a family member to do the renovations before moving in (which cost more than envisaged)... the family member now wants his money back asap and my friend (who thought he had 10 years to pay it back) is now trying to raise the money asap....


    As far as I know the banks don't do any real equity release nowadays... or do they? Does anyone have any suggestions on how I could advise him? Total amount is about 60k or so and the ltv is less than 50%.



    Thanks,
    s ;)


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    #2
    antoinolachtnai
    Registered Users Posts: 9,774 ✭✭✭antoinolachtnai


    What will the new LTV be if he gets this finance?

    Does he have documentation for the investment he made (planning, receipts, certificates)?

    I think he needs to talk to the bank or the broker he originally got the loan through.


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    #3
    sami2015
    Registered Users Posts: 27 ✭sami2015


    Hi Antoinolachtnai,

    Thanks for that; the new LTV would be less than 60%. Receipts exist for parts of the renovation and the renovations were undertaken with knowledge of the bank (just not the full scale of some changes/reroofing which were needed due to rot of some timbers, etc not discovered until the project was ongoing. No planning was needed for the project and the engineer's certificates etc showing compliance with building regs are available.

    I will advise contact with the original bank.... anyone got any experience of this working out retrospectively to the renovations?

    Thanks and regard,
    s ;)


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    #4
    jimmycrackcorm
    Registered Users Posts: 14,330 ✭✭✭✭jimmycrackcorm


    He can plan a remortgage that includes building an extension. Just provide a builder quote for the required extra amount.


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    #5
    antoinolachtnai
    Registered Users Posts: 9,774 ✭✭✭antoinolachtnai


    It all sounds like good business for the bank. They have a solid asset which has been made more solid as a result of the work. He just needs to find someone in the bank who can earn a commission from advancing the extra loan and will drive it forward.


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