If you have a mortgage and are looking to move to a new property, then you are probably wondering what happens to your mortgage when you move home. Fortunately, most mortgages are portable, however, there may be cheaper mortgage deals around, so it is a good opportunity to shop around and weigh up all your options.
Most mortgage lenders allow you to transfer your mortgage to a new property but may charge a fee for the transfer. The fee is usually a few hundred pounds but it is best to check with your lender to find out their exact rules and charges.
The new property you are looking to buy must be acceptable to your lender. Every lender has their own criteria and restrictions. For example, some lenders won’t allow you to secure a mortgage against a property that needs heavy refurbishment or perhaps a high rise flat. The lender will also want to value the new property and you may need a larger mortgage to purchase it.
When you move home it presents you with a fantastic opportunity to explore what mortgage deals are available. It may be that another lender can offer you a cheaper deal than your current lender can, especially if you need to borrow more.
The most important thing you need to consider is whether your current mortgage lender will charge you any fees to leave them. This normally happens if you have either taken out a discounted deal or fixed your mortgage for a specific length of time. Once the fixed period or discounted special offer ends, the mortgage will switch to a standard variable rate and you will no longer be eligible to pay any penalties if you wish to move to another lender.
It can be difficult to workout whether switching to a different mortgage lender who can offer you a better deal is more cost-effective than staying with your current mortgage lender when you factor in any fees you may be charged from your current lender to leave them and from the new lender to set-up the mortgage. This is where advice from a regulated whole of market Mortgage Broker is essential to ensure you secure a great deal and minimise any additional costs.
Mortgage lenders have become a lot stricter since the credit crunch and if you’re looking to upsize then you may find that your current lender will not allow you to borrow the amount you need to purchase the property. Perhaps your circumstances have changed since taking out your mortgage; for example you may have started a family, missed a few credit card payments or perhaps have been declined due to your age.
This doesn’t mean that other mortgage lenders won’t allow you to borrow the amount you need. Again in this situation, it is worth contacting your current mortgage lender to find out what they will charge you to leave them and then speak to a whole of market Mortgage Broker who can advise on which mortgage products are available to you, regardless of your situation.
For advice on the best mortgage deals available to you, speak to our whole of market Mortgage and Protection Brokers. Call us on 01702 533400 or arrange a call back.