Financial options when buying a site

[thejuggler]

I am looking to buy a site to build a home on at present. My current house is valued at 370k and has an outstanding mortgage of 148k I am loking for a site at present but am wondeirng how to finance the purchase without selling my current home. Even if I buy a site subject to planning permission it will still have to be paid for if and when the permission comes through.

How do others get around this difficulty?

 

[Sarah W]

You can either raise the money by remortgaging your house or by getting a standalone mortgage on the site. For the latter option you'd need a minimum of outline planning permission (First Active only - all others require full P/P) and you would need a deposit of between 10-20%; this can be from an equity release on your current home. For either option the total debt must be within the lender's income criteria.

Sarah

www.rea.ie

 

[emily_moss]

I am in a similar situation to you. I have found a site, hoping to submit planning permission application in the next month which will mean we will have to pay €200K for site when pp comes through.
I have a house worth about €240K with mortgage remaining on this house of €130K. The bank have offered an equity release of €167 on my house.

Have you spoke to the bank about another mortgage for the site?
We have to come up with 10% ourselves as banks / BS won't give 100% mortgages for sites - we are lucky to get 90% with EBS.

Also I am taking out a second mortgage with a partner and for some reason they are not too concerned with my existing mortgage. I will be keeping this house and renting it when the new house is built.

You may have an option of paying interest only on the site - we have 6 months interest option.

We will be under a lot of pressure to keep both going but hopefully it will be well worth it.

Talk to a mortgage adviser - they are used to this situation. I found Mortgages Direct very good.