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Mortgages : Do banks give your more than house worth for refurbishments?

  • 06-10-2018 8:36pm
    #1
    Jeaniemc1
    Closed Accounts Posts: 11 ✭


    Hi all,

    We are looking to buy a house that needs a lot of work.

    It is about 60k below our approved mortgage amount - Can we get the full mortgage amount with the view to use the extra 60k to go into home improvements? Or do banks only release the house value?

    cheers,

    Jean


Comments

  • #2
    Dymo
    Registered Users, Registered Users 2 Posts: 1,561 ✭✭✭Dymo


    Jeaniemc1 wrote: »
    Hi all,

    We are looking to buy a house that needs a lot of work.

    It is about 60k below our approved mortgage amount - Can we get the full mortgage amount with the view to use the extra 60k to go into home improvements? Or do banks only release the house value?

    cheers,

    Jean

    Strictly no, as the property will have to be valued by a professional auctioneer or engineer for the bank and they will only be valuing the property in its current state.


  • #3
    catrionanic
    Registered Users, Registered Users 2 Posts: 2,091 ✭✭✭catrionanic


    No, they won't. You'll have to fund the renovations yourself.


  • #4
    dudara
    Registered Users, Registered Users 2 Posts: 33,518 ✭✭✭✭dudara


    They do give money for renovations as part of the mortgage but you will need to furnish them with estimates / outline plans. And more importantly, their valuer will need to be convinced that the value of the property after the works will justify the lending of the funds. Eg house purchase price is €500k and you want €60k for works. The valuer wil need to be convinced that the house value afterwards is at least €560k.

    Talk to your bank or broker to find out more. It can be a lot of hoops to jump through and you may find it easier to do it later


  • #5
    howsshenow
    Registered Users Posts: 124 ✭✭howsshenow


    In my own experience Yes as previous poster outlined provided it is within your borrowing limits. The more they lend you the more they profit.


  • #6
    Trish56
    Registered Users, Registered Users 2 Posts: 1,256 ✭✭✭Trish56


    Agree with two previous posters. You need to get estimates for the proposed works and submit with your mortgage application and you can borrow up to 90% depending if you're a first time buyer or 80% if 2nd time buyer subject to valuation.

    The mortgage will issue in stages 1st stage will be to purchase the property (90% of purchase price) and the balance can be drawn down in stages either on submission of invoices for work completed or if the 65k is for structural work a certificate by a supervising Architect/Engineer who will have to supervise the work.


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