Moving Home Mortgages - Porting A Mortgage

Porting a Mortgage.

Moving home is something that can be a lot more familiar for some than others. On average, it’s said that you will move home at least three times before you’re 45. For others, it is a lot higher than this. If you’re a frequent mover, you may have sharpened your expertise in the world of mortgages and the best deals. Although, the rate at which mortgages amend their criteria and the speed at which the property market changes, it can be hard to keep on top of it all. To help combat this, an energy saving and time reducing concept has been thought up: ‘porting a mortgage’.

We’ve highlighted some of the key factors when porting a mortgage:

Porting a Mortgage

Transferring your old mortgage to your new home can come with some great benefits. For instance, you could dodge some of the charges associated to administration costs involved with new mortgages, and avoid fees and payment penalties for an early exit. However, it’s always advisable to speak to a mortgage advisor or your current mortgage lender about the process. They will no doubt want to reassess your financial circumstances to assess whether anything has changed, even if your mortgage amount hasn’t altered.

Non-Portable Mortgages

The only time a moving home mortgage will be deemed ’non-portable’ is if it’s a specialist mortgage under different legislation or if your financial circumstances have altered, for the worse. If you have missed payments or experienced credit problems throughout the term of your current mortgage, you can expect there to be difficulties moving it.

What happens if your new house costs more than your old one?

A bigger, or more expensive house, usually requires a bigger and more expensive mortgage. One of the best options available to you, in this scenario, is to pay off your existing mortgage and take a brand new one. This is an even better deal if you do not have to pay early repayment charges. Another solution is to port your current mortgage and make up the increased amount with either a further advance from your current lender, or take out a second loan.

Potential pitfalls of porting a mortgage

Although it is possible to move your mortgage and secure a good deal, there are never any guarantees. Here’s why...

Reapplying for a mortgage

Porting your mortgage means you will have to reapply for a moving home mortgage. It may’ve been some time since you last went through the mortgage application process, so the criteria may have altered, somewhat. This could result in you not qualifying, for whatever reason.

Borrowing More Money

Moving elsewhere, especially to a more expensive property, means you will more likely need to borrow more money. Again, this may not be to your lender’s taste and they may deem that you have already reached the maximum borrowing amount under your financial circumstances. However, you may be offered a solution through another mortgage, leaving you with two loans. To go down this route would not be advisable, with additional arrangement costs and higher rates, no doubt.

Porting a Mortgage with MortgageKey

MortgageKey love helping you find the right mortgage when moving home. But before you commit to selling your property and purchasing a new one, we suggest you do your checks, in order to see if you qualify to move your mortgage. After that, our experienced and knowledgeable staff will assist you every step of the way.

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Representative Example

A mortgage of £150,000 payable over 17 years, initially on a fixed rate of 2.44% until 31/12/2022 and then a variable rate of 3.59% for the remaining term, would require 25 payments of £899.04 per month and then 179 payments of £973.58 per month. The total amount payable would be £198,466. Includes Lender Fee of £995 and Broker fee of £695.

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