porting mortgage with negative equity

cs2000

Hello

We bought our flat with 100% deposit a year ago. if we sold now we would either break even or make a small loss. The mortgage is supposed to be portable but the bank (well call centre) is demanding a deposit if we bought a new proporty at the same price for what we sell our for.

1. can they do this for a portable product?
2. with small amounts of negative equity, do lenders generally let you transfer this to you new prpoerty. Eg you sell for £190k leaving £10k of negative equity. If you then bought another £190k flat would they let you effectivly have a £200k mortgage on it?

I have got a meeting with the mortgage lender in a couple of weeks, but forarmed is forewarned!!


Thanks
C

neverdespairgirl

You will probably get a better response on the mortgage board to your question, perhaps?

However, as I understand it, you have little to no chance of moving negative equity. A portable mortgage is subject to a new underwriting decision on the new place, and therefore you would need to meet their current lending rules, incl. a deposit of 10% or whatever it is for that bank.

So for a £200k flat they would probably only let you port £180k.

silvercar

1. yes. a portable product means you can take your deal to your new place. The new place is subject to underwriting again, so new lendling criteria, loan-to-value, income assessment, survey etc.

2.You can't sell with negative equity without providing enough money from elsewhere to pay back the loan in full.

garvbuck

I think there might be a chance that you could do it. I have seen that HBOS and Nationwide are offering negative equity mortgages, so that, though you'll have to have a 5 or 10% deposit on the new house, they'll allow you to borrow exactly the same amount that you currently owe on your old property. So, provided you had £8.5k or £19k for a deposit for the new flat, you might be able to port the £10k negative equity. It still saves you £10k.

I think these deals are really difficult to get hold of though - one website I looked at said they were only being offered 'discreetly' and to those with spotless credit histories. But I think they might exist.

kerryb13

i sold my property for £10k less than what it was worth and I had to pay the mortgage company the money that i owed at the point of sale. I couldn't port it to another property =(
I have heard some company's do allow it however... so it depends who you are with, I was with bristol & west at the time.