How can I get a loan of 100K for home improvements?

[foobar]

Hi all,
Ltd company contractor here with wife.
I need 100k for home improvements to pay back over 15-20 years.
Have had the door slammed in my face (despite 3 years of books signed off, clean credit history, no other bad debts etc) with computer says 'No' attitude from my bank and loan brokers who seem to go into blind panic as soon as you say you are ltd (low salary+divis).

Any advice from forum users would really make my day!

Thanks.

[Lance]

talk to a specialist contractor mortgage advisor. Loads of threads on here on that very subject. I think there was one earlier this week.

Or google 'contractor mortgages uk'

[northernladuk]

The low salary/divs shouldn't be a problem as the loan tends to ask for income.

I think it's more the type loan that is the problem. Those figures are more akin to a mortgage type product than a loan.

I'd agree with Lance and follow up with a mortgage adviser rather than a loan.

John Yerou at Freelance Financials is doing some work for me on funding an extension on the mortgage for a BTL as we speak so I'd say give them a shout.

[Maslins]

That would be a big sum for a "normal" personal loan, so is more mortgage territory.

Based on your home before any improvements, would there be spare equity to get the £100k whilst still staying sub (say) 90% LTV? If so, I'd have thought remortgaging would be your best bet.

If not, then to be honest I can understand why they're not keen to lend. They'd be lending you a huge sum, potentially putting you in negative equity, so there's not much security. Also if you only got half way through the home improvement project then came unstuck (or spent the money on a sports car) and the bank had to repossess, they'd unlikely be able to recoup all their money.

You may be able to get bridging finance. They'll charge far higher rates than normal high street banks, but then once the works are complete you can likely refinance in a more standard way (on the basis the value of the house would then be significantly higher).

[northernladuk]

Hang on. Only 100k? Wouldnt a contractor just pay that cash?

[Lance]

Hang on. Only 100k? Wouldnt a contractor just pay that cash?

if you had the cash...... Stick it in a stocks and shares tracker, and get a 1% mortgage that you pay off in 5 years.

[northernladyuk]

Hang on. Only 100k? Wouldnt a contractor just pay that cash?

Or simply arrange for the the Dutch Antilles trust that handles Your Co's payments to loan the money in a fast depreciating currency to the British Virgin Islands company that owns the residential property.

[foobar]

The low salary/divs shouldn't be a problem as the loan tends to ask for income.

I think it's more the type loan that is the problem. Those figures are more akin to a mortgage type product than a loan.

I'd agree with Lance and follow up with a mortgage adviser rather than a loan.

John Yerou at Freelance Financials is doing some work for me on funding an extension on the mortgage for a BTL as we speak so I'd say give them a shout.

Thanks northernladuk, With house worth 330K and outstanding mortgage of only 150K I thought an extension of only 100k would be a breeze but existing mortgage provider also balked because of the scale of the works (dormers, new garage etc) even though the place remains completely habitable with a small build time of 2 months. A personal loan typically has a max of say 3 years and only 20K. If I exit early early and remortgage with a self-build loan provider I get crucified by the exit fees. I will keep looking about but might have to suck it up and wait another few years and remortgage. Thanks everyone!

[northernladuk]

Thanks northernladuk, With house worth 330K and outstanding mortgage of only 150K I thought an extension of only 100k would be a breeze but existing mortgage provider also balked because of the scale of the works (dormers, new garage etc) even though the place remains completely habitable with a small build time of 2 months. A personal loan typically has a max of say 3 years and only 20K. If I exit early early and remortgage with a self-build loan provider I get crucified by the exit fees. I will keep looking about but might have to suck it up and wait another few years and remortgage. Thanks everyone!

I'm not surprised you are having trouble with those numbers. You'll have 250k borrowed against a 330k house where the value of the actually house will dip considerabley in the middle of the build. It's highly likely for the most part you'll actually be in negative equity during the build. Bummer...