Borrowing more on your mortgage

Why might you want to borrow more? 

Borrowing more is when you ask your lender for extra money. With Principality you can either remortgage or increase the amount you owe on your current mortgage.  

Common reasons to borrow more include:

• Home improvements 
• Urgent home repairs 
• Debt consolidation  
• Paying for a life event or goal 

Things to know about borrowing more  

The total amount you owe (your current mortgage, plus your extra borrowing) can't exceed certain loan to value (LTV) limits.

• LTV thresholds: 90% LTV for residential properties, 75% LTV for buy to let or holiday lets. 
• The extra amount you borrow is secured against your home. 
• Mortgage terms range from a minimum two years to a maximum term 40 years.
• You must wait 3 months after taking out a mortgage with us to apply to borrow more.  
• You should be up to date with your mortgage payments and show good repayment history.  
• You must meet our lending requirements. 
• You will be charged a fee for borrowing more. 

What's loan to value (LTV)? LTV is the percentage of your property's value that you borrow as a loan. 

Things to consider  

Before borrowing more it's a good idea to seek financial advice.

Here are some things to think about: 

• Can you afford the higher monthly repayments? 
• How much equity is currently in your home?
• Is the amount you want to borrow more or less than your equity? 
• If interest rates increase once your fixed term is over, could you manage higher repayments? 

How borrowing more works: an example 

You took out a £300,000 mortgage ten years ago. After making your monthly repayments, you’ve reduced the amount you owe to £236,000. Your property's value has increased to £420,000.   

You want to borrow £100,000 for home improvements If you do, you'd owe £336,000 against a property worth £420,000. You’d have an LTV of 80% and 20% equity.

Borrowing an extra amount for the remaining term of your mortgage would increase your monthly repayments - as you're now paying back your original mortgage loan plus the additional sum you've borrowed.
 

Remember: your mortgage repayments may change when you remortgage in future. Make sure you can afford the repayments both now and in the long term.You should think carefully before borrowing more. If you struggle to meet your repayments, you run the risk of your home being repossessed by the lender. 

How much more could I borrow? 

The additional amount you could borrow depends on your personal situation. Speaking to a mortgage advisor can help you understand what you're able to afford. And it's always a good idea to seek independent financial advice before making a big decision about your money.