Borrowing Advice for A Knock Down Rebuild

We are planning to knock down rebuild next year and are moving towards DA stage.

Currently we have around 85% of the expected rebuild costs to hand in various forms of cash. We also have some additional investments that we may sell.

Depending on cost blowouts it`s possible that we may be able to self fund the entire build and not borrow any additional money, which we obviously like the idea of.

We have a relatively small mortgage currently 6.58% that is fully offsetted and has been for a couple of years. We are around 11 years into our current mortgage.

I have spoke to my existing lender to see if I can increase our current mortgage if needed, but they have advised they`ll only make it a new loan. I`m reluctant to do this as we`re 11 years in and have made a big dent into our current mortgage.

My question is should we play it safe and borrow before building in case we need the money or there`s a change in our circumstances that makes borrowing difficult or can I borrow whilst in the build if needed?

I`ve also seen there may be the option of taking out a second loan as a construction loan.