Home Mover Mortgages
As a home mover, you have two options, you can either take out a new mortgage with a new lender when you buy a new home, which is usually the best option for those looking to move up the property ladder who need to borrow more money. Or, in many cases, you can take your current mortgage with you, through a process known as porting.
Which option is best suited to your needs will depend on your circumstances and why you’re looking to move to a new home.
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What is a home mover mortgage?
There is usually no specific product designed for people moving home, a home mover is simply a term used within the mortgage industry to denote why you are taking out a mortgage. The same deals will typically be available to you as home movers as those who are first time buyers.
Finding the right deal for your needs is key, whatever your circumstances, so whether you want a fixed rate deal or a variable rate mortgage, or even more flexible terms, such as a mortgage with an offset facility, we can help you find just what you’re looking for.
Will I have early repayment charges to pay if I move to a new lender?
It depends on the type of deal you are currently on. If you are on your lender’s SVR (standard variable rate) there should be no Early Repayment Charges to pay when you move home, although you may still have to pay small exit fees to close the mortgage account.
If you are tied into a fixed-rate period, or in the initial term of a discount or tracker mortgage, you will likely have early repayment fees to pay if you want to leave the deal before it ends.
When you take out a mortgage with a different lender, you will also need to pay all of the fees involved with buying a home, as you did as a first-time buyer. This will include arrangement fees, legal fees and valuation fees.
What is mortgage porting?
Porting your mortgage is when you transfer your mortgage when you move home. It involves staying with the same lender and taking the same mortgage deal with you that you took out to buy the home that you are now selling.
Most modern home mortgages are portable, and this can be easier if you are planning to move to a similarly priced property.
When you port your mortgage, however, it is essentially a new mortgage application, so you may be reassessed by the lender, to ensure that you meet the affordability criteria for the new property and its purchase price.
There are typically fewer fees involved, however, you will usually still need to pay new valuation fees, legal fees, and stamp duty.
Can I increase my original mortgage amount when I port?
When porting your mortgage to a new property you will usually be re assessed as a new client, you will need to meet the standard income and affordability rules at the time of re applying.
The extra amount you need to borrow along with the current mortgage will need to be affordable and the extra borrowing over and above your current loan size, will be taken out on a rate that is available at the time of moving.
Some lenders will insist that you take out another loan with them to cover any additional borrowing when you port with them. This could leave you with two separate interest rates and sets of terms, with the same provider.
What about downsizing?
Home movers who chose to port their mortgage to a lower value property may be required to pay an early repayment charge if they move a lower value loan to the new property.
The lender will asses your financial circumstances and the monthly repayments must remain affordable based on current criteria, regardless of the new loan size. As whole of market mortgage brokers we can asses your needs at each stage.
Are you moving house and looking for a home mover mortgage in Berkshire?
If you’re looking for a new home in Berkshire, we can help you review your options and your financial situation, whether you are keen to stay with the same lender or are hoping to find a better deal with a different one. An agreement in principle via a whole of market mortgage adviser would also give you peace of mind when moving home.
What is needed to qualify for a home mover mortgage?
If you decide to pay off your existing mortgage and take out a new one when you move house, you will essentially be a new customer, which means that you will need to meet the typical mortgage qualification criteria, such as affordability, creditworthiness etc.
Equity is very important to home movers, however, as the equity you have in your current property is used as a deposit to secure your lending on the new property.
Equity is the element of your property that you already own compared to it’s current market value. It includes any deposit you put down initially and the repayments that you’ve made to date, and will change with the value of your home.
This means that you could have gained a substantial amount of equity simply from a rise in house prices. If you have a good level of equity in your existing home, it will be easier to increase your loan size when moving home.
Simmonds Mortgage Services; securing you the best home mover mortgages in Berkshire
Simply get in touch with us, here at Simmonds Mortgage Services. We’re Berkshire based, so can help with local knowledge and house prices, as well as secure you the right mortgage for your needs and helping you at every stage of the application process. Using a mortgage broker like ourselves can help with the stress of moving home.
I am relocating to Berkshire, can I get a home mover mortgage through Simmonds Mortgage Services?
Yes, we can look at all of the mortgage options available to those moving home and help you decide whether you would be better off porting your current mortgage deal with you to your new home, or if you could save money with a new lender.
Porting can be a great way to avoid extra fees, but your current mortgage may not necessarily offer the most competitive interest rate for your going forwards, especially if you're looking to borrow more. Using a mortgage broker like Simmonds mortgage services can help navigate the minefield that is the mortgage world. Mortgage Brokers do it day in and day out, so using one will put you in a great position with your home move.
Can you move house with negative equity?
It's unlikely that those in negative equity (where you owe more than your home is currently worth) will be able to upsize and move home, especially if you are looking to increase the size of your loan.
It's possible that your current lender will allow you to port your mortgage, but this is typically only if you are downsizing or keeping the loan the same size.
Offering a cash deposit is another potential option if you are in negative equity, but you will usually need to approach specialist lenders in these circumstances.
Do I have higher chance of approval if I stay with my existing mortgage provider and port my current mortgage deal.
Most lenders will typically re asses you as a new customer so be prepared for the same assessment and income needs as if you where moving to a new mortgage provider. If the loan was staying the same or reducing then you may be assessed more leniently.