House extensions on finance are a great way to maximise the space in your home. They’re often a lot cheaper than moving house and can add a considerable amount of value, too. However, it’s important to consider how you can sensibly finance an extension, so that it doesn’t overrun your budget and leave you with a debt that takes too long to pay off.

Who do I get to draw up plans for an extension?

There are several options for funding a house extension, including personal savings and loans. Savings are usually the best option if you have them available, as they mean that you won’t incur interest charges or repayments in future. However, if you don’t have enough money saved to cover the cost of your extension, you might be tempted to put it on a credit card. However, it’s worth remembering that standard credit cards typically have high interest rates and can easily spiral out of control.

Remortgaging your property is another option and can help you to fund an extension with lower interest rates than those of a personal loan. However, it’s crucial to have a detailed budget and a timeline in place before you start so that you can ensure the work is completed on time and within budget. If you have a fixed rate mortgage, remortgaging could also trigger Early Repayment Charges.

Taking out a personal loan is a good option if you’re not planning on selling your property in the near future and are happy to pay back the debt over a longer period of time. The key is to be clear on your goals and work closely with your design/build team so that costs are managed efficiently.