Top up the best option?

Hello,

i am looking to extend onto the house, got a quote for ~40k. Wondering what is best method of attaining the money.

Current Mortgage is .75% + ECB for 195k, house value is ~380k, over 27 years. I only changed to BOI 1.5 years ago in which they paid all the fees which was a great deal at the time.

So, i am wondering is a TOP UP my best option to get the funds? Or am i best advised to go for another re-mortgage? If so, any advice on a good deal, with less legal fees etc so i don't end up getting stung.

Time is not a problem, i am in no rush to push it through although i did have to wait 2 months the last time to sort the re-mortgage - typical small details slowing the process down.

Many thanks.

My suggestion is you leave your mortgage as it is. The 0.75 above the ECB rate is a good deal in the current climate and the any bank will unlikely give as good a deal at the moment. Could you perhaps look into a personal loan with first active or tesco, i think they are offering around 6.8 - 6.9% interest, my thoughts are that you would be better paying the higher percentage interest on 40K over a shorter time, than loosing the good mortgage rate you have on 195K.
It also depends on if you a currently stretched but if you could afford the higher loan payments over 5 years then thats what i'd do

Thanks for the fast reply Dmac ...

... for a personal loan outside the mortgage, any idea anyone off the top of your head what repayments would be on 40k over 5 years? I don't know but i imagine they'd be pretty crazy?

ALSO - would i have to go through Solicotors for this TOP UP mortgage? Are they any others fees anyone is aware of?

Cheers!

Tesco will only give you 30K, the repayments on this over 5 years would be 589 per month,
With first Active they will give 40K, the repayments on this over 5 years would be 785 per month, stretch this out to 10 years and it would be 456 per month. Obviously over the 10 years the loan will cost you more. Both these are fixed rate loans and the quotes are without payment protection, i think they are the cheapest on the market but i'm open to correction on this.

With a top up mortgage it depends on the lender if you need to go through a solicitor some do, some don't require a solicitor

Bear in mind you got free legal 1.5 years ago when you switched, do they not have a claw back on this if you don’t stay with them for a minimum time?

I guess we'll find out, i am meeting with them next monday. Thanks for all the advice folks, much appreciated.