House extension finance

There are several ways to fund a house extension and obtaining finance is usually the most common. This can be in the form of a private unsecured load, a secured loan, extending an existing mortgage or obtaining a new mortgage.

Most home owners simply extract some of the existing equity out of the home to be extended and provided that total borrowings do not exceed 85% of the estimated properties value then this should be an acceptable form of finance to most lenders.

However, you obtain your house extension finance, it is vital that the money released is well spent and has added value on the main property if at all possible. Frivolous or irresponsible spending of the house extension finance on cars, holidays or garden hot tubs for example is not money well spent for the long run.

There may be rules or conditions attached to your house extension finance which seek to control where the money is spent. It is not unusual for the lender to employ their own surveyor to monitor the works so that money can be released in stages for work completed on the extension by your builder.

Most builders prefer you to have ready access to your home extension finance and any delays beyond 14 days from the issue date of their invoice is usually seen as obstructive to good client / builder relations. Therefore you do need to know the time scales for the interim issuing of any house extension finance in various traunches.

Should the home owner be fortunate enough not to require house extension finance and be able to fund the works from their own funding provision, then this is normally the best and easiest way to pay your builder. However it is vital not to let your builder know of your unfenced wealth for fear of adding extras to the build. Always make your builder assume that you are financed up to the hilt so that every penny counts.