Mortgage hypothetical question

C

chewyluey

Registered User
Messages
19
Hi There

I have a hypothetical question about a mortgage.

Scenario:

- Lets say one is mortgaged approve to the tune of €240k and has a 20k deposit (example figures). (total possible purchase price 260k)
- They see a house that will obviously need furnishing and will also need some minor work done inside e.g. new fireplace, some floor tiling, one or two windows need replacement..
- This house can be bought for say €220k
- So to buy the house itself only 200k mortgage + the 20k deposit is required

The question is, since the person is approved for a mortgage of 240k but only now needs to borrow 200k, is there the possibility to borrow 210k and putting the extrra 10k towards the work that needs to be carried out in the house ? Do different banks have different policies on this or should it generally be seen as no problem considering the amount being borrowed will still be way under the pre-approved amount.

Thanks
 
"is there the possibility to borrow 210k and putting the extrra 10k towards the work that needs to be carried out in the house ? Do different banks have different policies on this or should it generally be seen as no problem considering the amount being borrowed will still be way under the pre-approved amount."

No chance.

Banks will only lend a percentage of the actual purchase price or their own valuation, which ever is the lower.

mf
 
Yeah I'm Afraid no chance.
We recently bought our first home. banks valuer put value @ E220k. Our purchase price was 160k.
max we could get was just over 147k.
i even asked could we have extra 10k do some minor improvments insulation etc ...
no chance
 
the valuer gave the resale value @ 220k but purchase price at what we paid
 
That's interesting enough.. the banks valuation was 37% over what you paid.

Congragulations on the new house... it's a pity alright that you can't get the improvment loan at mortgage interest rates, which are low or very low. You'll probably have to get a personal loan or a credit union loan for the improvments, which will be at a higher interest rate.
 
Thanks

My OH refused to get a personal or CU loan to do the work instead
we are going to do it 'old school' way lots, friends & family are going to give us few days over the next few weeks.

House should be totally complete 4-5 weeks.
 
Lot to be said for doing it the old way, there wouldnt be as much debt in the country if more people did that. Those of us old enough can remember living with concrete floors and sheets on the windows until funds allowed.
 
chocolatecak said:
Lot to be said for doing it the old way, there wouldnt be as much debt in the country if more people did that. Those of us old enough can remember living with concrete floors and sheets on the windows until funds allowed.
Click to expand...

I remember as a child we moved into a new build home and it was indeed cement floors until my parents could afford floors. And one of the rooms was about 10 years before getting floors and furniture. I bought a house this year and while I would love to have a coffee table to rest this laptop on I won't get things until I have the cash for them.....Slowly and surely is not a bad plan. The furniture we have is all paid for and we will get the rest as we have cash (eg spare bed, coffee table, lockers, mirrors) And I agree if people had done things the old way then personal loans and credit card debt would be much lower. What happened to saving up the cash to go on holidays too?? Loans and credit cards for that was commonplace. And now people have huge personal debt......
To the OP it is not a bad thing not to get the money added to the mortgage, adding it to the mortgage means paying all the interest on it too.
 
Also if you were to get extra mort for furniture it would be the most expensive furniture you ever bought in your life!!!
 
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