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How does remortgaging work for home renovations?

Written byKoyo Loans
First published26th August 2022
  • How does remortgaging work for home improvements? 
  • What to think about before remortgaging for home improvements 
  • Alternatives to remortgaging for home improvements 

Planning a home improvement project can add value to your property and enhance your living conditions. Whether it’s a new bathroom or an extension into the back garden, improving your current home is often cheaper and less stressful than moving to a new place. But what’s the best way to pay for home improvement work? Below, we explain how remortgaging works, as well as other ways that you can pay for your planned home improvements. 

How does remortgaging work for home improvements? 

For some homeowners, remortgaging can be an effective way of financing home improvement projects. In fact, there are two options available to you if you want to take some of the equity out of your home:


Remortgaging is the act of taking out another mortgage and can be arranged through any mortgage provider. You will need to negotiate with a lender to take out a new mortgage to cover the entire cost of the proposed project. 

For instance, if you have a current mortgage of £150,000 and a new kitchen will cost you £10,000, you can apply for a new mortgage of £160,000. You can then use the additional £10,000 to fund the home improvement project. This is a long-term commitment, as you will be required to pay the money back over time with interest. 

Borrow more from your current mortgage lender 

Another option is to stay with your current mortgage provider and request a higher sum. This is a good idea if you currently have a reasonable rate of interest, but their decision will depend on how much of your mortgage you’ve currently paid off, as well as the current value of your home. If you borrow more with your current mortgage provider, you might find that you are offered a higher rate of interest, so it’s worth shopping around. 

What to think about before remortgaging for home improvements 

It’s important to think about the long-term impact of remortgaging before deciding on the best way to finance a home improvement project. If your financial circumstances were to change in the near future, it might be difficult for you to meet the bigger mortgage payments. You also need to be mindful of any extension to your mortgage period, as it might eat into your planned retirement years, causing you to work for that little bit longer. 

You should also weigh up whether renovating your current property is your best option. For instance, instead of building an extension at your home, you might find that it’s financially beneficial to relocate to a different area, where you can buy a bigger house for less money. 

You should also consider how certain renovations influence the value of your home, as it’s important that any project that you carry out has a good chance of adding value to your property. Of course, remortgaging isn’t the only way to pay for home improvements, as we explain below. 

Alternatives to remortgaging for home improvements 

While remortgaging is a good way to pay for home improvements, it’s not your only option. Perhaps the best way to finance a home improvement project is to pay for it with savings. If you’ve decided to renovate the kitchen or bathroom, for instance, create a budget and put some money away each month until you reach the total. You will then be able to pay for the renovations in cash, and you won’t be subject to interest payments long into the future. 

Another viable option is to apply for a personal loan. For many people, personal loans are affordable and accessible and can be used to fund a broad range of home improvement projects. At Koyo Loans, we offer unsecured personal loans of between £1,500 and £12,000 that are ideal for any home improvement project. 24.9% APR Representative. You can use our loan calculator to work out how much you can borrow before starting the application process. 

So, while remortgaging is an effective strategy if you’re looking to start a home improvement project, it’s not your only option. It’s best to do your sums before remortgaging your home, as you need to make sure that the home improvements are likely to add value to your property once completed. 

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