If you have sufficient equity in your home you may be able to borrow more money for a second home, home improvements, debt consolidation, school fees, divorce settlement and many other purposes. You may not be able to raise additional money for business purposes, gambling, paying a tax bill or investing in stocks and shares. This is not an exhaustive list and each lender has their own criteria.
You will need to demonstrate that you can afford any additional borrowing, our maximum loan calculator will give you an indication of the amount you may be able to borrow for the income you earn and the expenditure you incur.
Should you approach your existing lender or look for a new lender? If you have redemption penalties on your current mortgage then it may be best to ask for a further advance from your current lender. The rate you will be offered is likely to be higher than the rate you’re on. It may still be beneficial to consider another lender, even if you have penalties to leave, especially if you’re increasing your mortgage significantly. A better rate might be available elsewhere – there is nothing to lose by finding out.
If you have no redemption penalties on your mortgage then you can still ask your current lender for a better deal, although we would expect you to be able to get a better deal elsewhere because very few lenders offer their most competitive rates to existing borrowers. Get in touch and we will let you know what is available.
You can only have one mortgage on your home, so you will not be able to have two lenders (i.e. one for the additional borrowing and one for the existing borrowing). There are companies that offer secured loans (not mortgages) on your property, they get second call on your property if you cannot meet the payments and the property is repossessed. Because of this their rates are likely to be more expensive than a mortgage but an option to consider if your income is not sufficient to secure the amount that you need