How do you move house with a mortgage?
These are the key steps to getting a moving home mortgage.
Understand your affordability
Before you put your house on the market, it’s key that you take the time to properly understand how much you can afford to buy. Whether you’re upsizing, downsizing or moving to a new area, you need to know what you can afford. If you speak to a mortgage broker like us, we’ll look at your outstanding mortgage, your financial commitments and work out what is affordable for your next steps.
Do you want to port or redeem your mortgage?
If you already have a mortgage, you have two main options with regards to moving home:
- Porting your mortgage
This basically means taking your mortgage with you to your new home. This can be a sensible option if you are mid way through a fixed deal and would incur early repayment charges. Or you’re happy with your current rate and want to move this rate to your new home.
- Switching to a new mortgage
When you switch to a new mortgage, your existing mortgage is repaid when you complete on the sale of your existing home. You then take out a new mortgage on your new property.
We will explain the different options with you. And do the calculations to help you understand which option suits your circumstances. Not all mortgages are portable and some lenders have restrictions in place with regards to suitable properties.
Do you need to borrow more?
If the home you want to buy is more than your current home, we will help you understand if you can borrow more. There are three main options available to you:
- Port and increase your current mortgage
- Port your current mortgage and take out an extra loan
- Redeem your current mortgage, then apply for a larger loan with a new lender
Your broker will take the time to explain the various options and which is the most suitable for your circumstances.
Do you want to keep your existing property
Are you thinking about buying a new property and keeping your current home to rent out? If so then you need a Let to Buy Mortgage. There might be several reasons why you want to keep your existing mortgage. Here are some of the most common reasons our clients tell us about. Perhaps you want to:
- Purchase a home with your partner, but keep your home as security for the future
- Move to a new house but keep your property as an investment for the future
- Move home when you haven’t been able to sell your current home
- Relocate with work but want the option of moving back home in the future
- Keep your home to benefit from high rental yields
Understand what fees are involved with moving
Whether you are porting your mortgage or switching to a new one, there are certain costs you need to think about. Here are some of the main ones:
- Stamp Duty – you’ll pay Stamp Duty if the purchase price exceeds £250,000. The amount you pay depends on the purchase price and whether you owe other properties
- Conveyancing Fees – you’ll need to pay a solicitor to arrange all the legal paperwork for your home move
- Early Repayment Charge – if you are switching your mortgage and your deal hasn’t come to and end, you might need to pay an ERC. This can be thousands of pounds so is worth considering.
- Mortgage Valuation – the lender will want to value the home you are buying. This is to ensure it’s worth what you are paying for it. And it meets their lending criteria.
There are other costs you need to consider such as home insurance, removal costs, forwarding post. But these are the main mortgage related costs. Our mortgage advisers will take the time to explain how much these costs are likely to be. And to help you build these into your overall affordability.
Cost in the additional services to your overall affordability
When you speak with us about your moving home mortgage, we can talk to you about what additional services you may need. We will let you know how much these are likely to be so you can build these costs into your overall budget. We’ll refer relevant businesses to you should you wish including conveyancing, energy performance certificates and specialist property reports.
Book a mortgage appointment today to find out how we can help.
How can Your Mortgage Expert Help?
If you’ve read our Guide to getting a moving home mortgage and you want to be like the other 87% of people now using a mortgage broker, why not get in touch?
Searching the market yourself can be time-consuming. But with our help, we can compare thousands of mortgages, including exclusive deals and lenders that you wouldn’t otherwise have access to. We have regular contact with a wide range of lenders, some of whom you may not even know exist! With our help, you won’t have to search or contact each individual lender in order to compare the mortgage terms and rates; we’ll do all that for you.
If you are looking to sell your house this year and you’re interested in having a no obligation chat about your mortgage, why not get in touch? We don’t charge anything up front, so by speaking to us, you are under no obligation. We are based in Salisbury, Wiltshire, but we can help you no matter where you live in the UK.
Simply call us on 01722 322683 or complete a contact us form on our website and tell us when it would be best to get back in touch with you.
There is no guarantee that it will be possible to arrange continuous letting of the property, nor that rental income will be sufficient to meet the cost of the mortgage.
You may have to pay an early repayment charge to your existing lender if you remortgage.
A MORTGAGE IS A LOAN SECURED AGAINST YOUR HOME. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE OR ANY OTHER DEBT SECURED ON IT.
There may be a fee for mortgage advice. The actual amount you pay will depend upon your circumstances. The fee is up to 1% but a typical fee is 0.3% of the amount borrowed.