Remortgage with Negative Equity to Fund Extension

[GORL]

This topic is also pertinent to the Extensions forum but I think it's probably more appropriate here given that it's financially focussed:

We are in negative equity (c.-150k) but are managing to meet repayments at moment
We are in a small house bought at height of boom but thankfully have room for extension
Need larger house for growing family
No savings (and no chance of rectifying significantly within short-term)
Both in secure public sector jobs
Currently on tracker mortgage

We really need the extension and are trying to think laterally about ways to fund it given that we have no savings and that we have no hope of moving to a bigger house. It will cost between 70-100k.

We could manage increased payments of up to 500 per month (at a stretch) on a renegotiated mortgage.

Would the bank entertain us asking to renegotiate our existing mortgage given that the extension would add value ultimately and prevent us from having to leave the country and/or defaulting altogether?

Would it even be an option to get a short term personal loan for the extension and then get it valued when finished and remortgage based on the new value (obviously we'd want approval in principle for the remortgage first)?

Is anyone else in a similar situation and has come up with good financing ideas?

Many thanks in advance for all help!

 

[ClubMan]

I very much doubt that the lender will advance more credit in these circumstances. Normally they don't want to go above c. 90% loan to value ratio and you are in negative equity so well beyond that already.

 

[Bronte]

We are in negative equity (c.-150k) but are managing to meet repayments at moment

It will cost between 70-100k.

We could manage increased payments of up to 500 per month (at a stretch) on a renegotiated mortgage.

That's some extension, 100K? That's the price of some whole houses now. I doubt the extension will add much value, not even the cost of build.

You say you are managing to meet repayments at the moment but are unable to save anything and are now suggesting that you would be able to pay an another 500€ a month, how do you figure that out?

There is something wrong if with two public sector jobs you have zero savings, maybe you should do the money makeover section for advice on budgeting.