So I want to renovate my house. My dilemma is:

1. Do I overpay my mortgage, effectively using the equity as a bank account and then borrow against the property at a relatively low interest rate?


2. Save money in a savings account. Then after the savings have built up, take out a personal loan?

The problem is, I have lots of equity in my house (100k +) but for an equity release loan, the max I can borrow is 3.5 times my salary. And as I have a mortgage already (only 1 year old), I'm pretty much at my max so I am unable to use the equity in my house. Even thought my mortgage repayments are very affordable.

Overpaying my mortgage will bring the capital down, and as a result SHOULD free up some borrowing room (provided the market value of my house stays the same or rises).

This will be a 1-2 year long plan, but I want to start now and I'm not sure which route is best to take!