Nationwide's response on how to maximise the value of your home

Thinking about making some home improvements? Divisional Director for mortgages and savings Matthew Carter has some suggestions for raising those much-needed funds.

15 October 2007

Making home improvements to add value to your home can seem extremely daunting, especially when it comes to finding the money to start and complete your project. Most of us don’t have £50,000 sitting around in an account waiting to be spent on an extension or loft conversion, but there are a number of ways in which funds can be raised for such projects.

Re-mortgaging

If you’re looking to re-mortgage you could consider applying for additional mortgage borrowing at the same time. This is a low-cost way of paying for things you want and taking those first steps of turning that dream renovation into a reality.

There are several options when it comes to additional mortgage borrowing, depending on how you want to use the money it makes available.

Further Advance

Further advances are available on fixed rate and tracker mortgages, if you wish to add to your existing mortgage. You’ll receive the funds as a lump sum to help you to make those home improvements.

Drawing down on your mortgage

Some providers offer advances which allow you to draw down lump sums from your existing mortgage as and when you need it. For example if you were embarking on an extension and needed to borrow £50,000 to pay the builder and furnish the house you could initially drawn down £40,000 to pay the builder and then draw down from the remaining £10,000 as and when you need it. Interest is only paid on the money you have drawn down on and you don’t have to borrow all the money in your agreed limit, there will however usually be an expiry date which you’ll be notified about in advance.

Personal Loans

If you don’t want to raise money against your mortgage, unsecured personal loans offer an alternative way to raise funds. You can borrow various amounts over different time periods and there are a number of competitive rates available.

So instead of spending years saving for that dream there are alternative ways to get hold of that much-needed cash.

Responsible lending

When looking to raise additional funds, for whatever purpose, you should consider all your borrowing options and seek independent advice where necessary. Always check your fees and interest rates – you may be able to shop around for better terms.