You have found the home of your dreams. It has incredible potential, but it is clear that work is needed. This is often the case when you prefer to invest in the old. But with the cost of the house, how are you going to cope, to carry out these repairs?
The cost of the work included in the mortgage, yes, it is feasible:
Change a poorly insulated roof, redo the electricity, create an extension, there is no shortage of projects when you want to acquire a property to renovate. It is often easier to access the property with a property where work needs to be done, because the sale price is lowered. However, for the well-being of the inhabitants, it is often important to get the work done quickly.
You can therefore quite ask to include the price of the works in the mortgage. This presents, in addition to the practical aspect, advantages which should not be overlooked. The cost of the work is merged into the repayment of the loan, which is made over a long period. You only have one rate; that of mortgage loans; which, depending on the period, can be very interesting. However, it is imperative that your debt capacity, including this amount, remains below 30%. Another point to respect, you will have to provide supporting documents, relating to the good progress of the works.
Why not apply for a work loan, in addition to your home loan?
There is however a second solution. It cannot be applied to specific works that require the expertise of a roofer, for example. But if the repair work is within your reach, because you are a good handyman, you can content yourself with requesting, in addition to your mortgage, an unrestricted work credit (or personal credit).
This leaves you free to buy the materials as you see fit and carry out your repair task, without having to give supporting documents to the bank. On the other hand, there again, this can only be done if your debt capacity remains within the acceptable average.
How can I be sure that my credit application will be accepted?
You can, if you know the sale price of the house, the notary fees, make a calculation. Do not forget the amount of insurance and the various costs related to a mortgage. Include the estimated amount of your work. See according to your resources but also your expenses. If your debt capacity allows you, you will be more serene to make your request with your banker.
Be aware that there are simulators on the Internet that can help you. You can also get help from a financial professional, if all these figures are beyond you. Depending on the information given, he will be able to tell you if your file is likely to go through or if the addition of the work is too much. Comparators can help you find a more open bank if you want to compete.