The Ways a Remortgage Can Fund a New Kitchen and Beyond...
- By Howard Ogollegos
- Published 09/19/2011
- Real Estate
- Unrated
One of the most common ways that people improve their homes and increasing the property value is by updating the kitchen. Many experts say that this should be at the top of the list for home improvements, and this makes a lot of sense considering the amount of value that can be added to your home.
Refitting your kitchen can provide two main benefits. Firstly, it can give you and your family a better living space, more storage and help you make better use of the room you have available. Secondly, a new kitchen can increase the value of your home and make the property more attractive to potential buyers wither now or in the future.
The cost of installing a new kitchen in your home can be significant. The consumer magazine Which? recently found that Brits spend an average of GBP 8,000 on a new kitchen whilst a bespoke, designer kitchen can easily set you back over GBP 25,000. Even a basic, low cost set of kitchen units and appliances can cost several thousand pounds.
Few people have the cash to fund a new kitchen and so finding the money needed to undertake the work may be your first step. Whilst many people consider loans or credit cards to fund the work, a remortgage is one of the most straightforward and cost effective ways to pay for your dream kitchen.
A remortgage is simply changing your mortgage product either with the existing lender, or with a new one. When you remortgage, you can often borrow additional funds. This is known as a 'further advance', and the lender will deposit the funds to your bank account for you to use as you wish.
You do however, need to have sufficient equity in the property in order to borrow the addi
tional funds in order to refurbish your kitchen. You can usually borrow up to 90% of the value of your property; however you should beware that this may cause the interest rate to be higher.
The process will also be much the same as when you first took the mortgage out, and the lender will need to assess your financial situation in terms of income and outgoings. Other credit that you have will also be taken into consideration, including credit cards, loans and finance, so it is always advisable to keep up with repayments in order that your credit rating remains good.
Another key advantage of choosing remortgaging as an option is the fact that you can generally borrow both your main mortgage and the extra finance that you need for your new kitchen on a very competitive rate of interest. Most high street lenders offer extremely competitive fixed and discounted interest rates to entice borrowers into switching banks and in some instances they will also often pay some or all of the additional costs that inevitably rack up in the remortgage process, such as a valuation or the standard legal costs.
Once your finance is arranged, you can get to work on your new kitchen. An important thing to remember is that you should stick closely to your budget for the improvements. A 2009 report in the Daily Express found that the average new kitchen added GBP 4,147 to the value of a property and so it's vital that you don't overspend otherwise you could end up out of pocket.
If you are looking to spend a significant sum on improving your kitchen, a remortgage could be the perfect way of raising the cash. You can take advantage of a great mortgage deal and spread the payments over a term that is affordable to you. You are then free to begin the refit and get the dream kitchen you have always wished for.
Refitting your kitchen can provide two main benefits. Firstly, it can give you and your family a better living space, more storage and help you make better use of the room you have available. Secondly, a new kitchen can increase the value of your home and make the property more attractive to potential buyers wither now or in the future.
The cost of installing a new kitchen in your home can be significant. The consumer magazine Which? recently found that Brits spend an average of GBP 8,000 on a new kitchen whilst a bespoke, designer kitchen can easily set you back over GBP 25,000. Even a basic, low cost set of kitchen units and appliances can cost several thousand pounds.
Few people have the cash to fund a new kitchen and so finding the money needed to undertake the work may be your first step. Whilst many people consider loans or credit cards to fund the work, a remortgage is one of the most straightforward and cost effective ways to pay for your dream kitchen.
A remortgage is simply changing your mortgage product either with the existing lender, or with a new one. When you remortgage, you can often borrow additional funds. This is known as a 'further advance', and the lender will deposit the funds to your bank account for you to use as you wish.
You do however, need to have sufficient equity in the property in order to borrow the addi
The process will also be much the same as when you first took the mortgage out, and the lender will need to assess your financial situation in terms of income and outgoings. Other credit that you have will also be taken into consideration, including credit cards, loans and finance, so it is always advisable to keep up with repayments in order that your credit rating remains good.
Another key advantage of choosing remortgaging as an option is the fact that you can generally borrow both your main mortgage and the extra finance that you need for your new kitchen on a very competitive rate of interest. Most high street lenders offer extremely competitive fixed and discounted interest rates to entice borrowers into switching banks and in some instances they will also often pay some or all of the additional costs that inevitably rack up in the remortgage process, such as a valuation or the standard legal costs.
Once your finance is arranged, you can get to work on your new kitchen. An important thing to remember is that you should stick closely to your budget for the improvements. A 2009 report in the Daily Express found that the average new kitchen added GBP 4,147 to the value of a property and so it's vital that you don't overspend otherwise you could end up out of pocket.
If you are looking to spend a significant sum on improving your kitchen, a remortgage could be the perfect way of raising the cash. You can take advantage of a great mortgage deal and spread the payments over a term that is affordable to you. You are then free to begin the refit and get the dream kitchen you have always wished for.
Howard Ogollegos
Howard O'Gollegos writes for JustCommercialMortgages.com the UK's No.1 site for the latest commercial mortgage rates and commercial property finance news.
View all articles by Howard Ogollegos