A Home Improvement Loan Can Be the Perfect Way to Finance Your Extension

The recent tough housing market has meant that more and more people have chosen to stay and improve their homes rather than buy a new property. Instead of buying a bigger house, one of the most popular ways to create additional living space for your family is by building an extension. As well as adding one or more extra rooms to your home, an extension can also make your property more attractive to potential buyers.

But, how much do extensions cost? And, what are the possible ways to fund the cost of an extension? Our guide will help answer these questions.

Adding an Extension to Your Home

There are lots of factors to take into account when considering an extension to your home.

Firstly, you have to decide what size the extension should be and what the space will be used for. There is a vast difference between a small kitchen extension and a large two storey extension that may add multiple new rooms to your home.

George Clarke, architect and resident expert at The Home Show, says: “I always think, if you're going to do an extension, make it as big as you can possibly afford without compromising on quality of your house, compromising the size of your garden or annoying your neighbours.”

You also have to design an extension that fits in with the design and materials of your existing home. It needs to be integrated with the existing interior to avoid looking like it is obviously an additional construction bolted onto the back of your home.

And, you will also need to take the issue of planning consent into account. Channel 4 reports that ‘you can add 10 per cent of the area of a house - or less than 50 cubic metres - without permission (assuming it's not already been added to or isn't in a protected area).’ However, a larger extension (or if you live in a conservation area or a listed building) is likely to require planning permission.

Finance Your Extension with a Home Improvement Loan

Building an extension isn’t cheap. Figures from Channel 4 estimate that a single storey extension will cost £795 per square metre whilst a two storey extension will cost £701 per square metre. And, that is assuming that you undertake much of the work yourself. Employing a company to complete the work will almost double the cost (to between £25,000 and £50,000).

So, finding the finance for the work is crucial. A home improvement loan can be the perfect way to borrow the money that you need for your extension. You can use the equity in your home to agree a loan over a term that results in an affordable monthly repayment. And, many lenders will lend against the ‘when finished’ value of your home, meaning that they will take the increased value of your property after the extension is completed as the basis for its valuation.

You will also have to demonstrate that the loan is affordable to you and your interest rate is also likely to be determined by how good your credit rating is.

So, if you are looking to add value and living space to your home, why not see how a home improvement loan can get you the extension that you want?

To get your home improvement loan, fill our form on the right.