CAT Mortgage query

Toki

I currently am one of the lucky ones with a tracker mortgage 0.75% above the base rate. The mortgage is a CAT standard tracker with the Abbey. We are thinking about moving to a bigger house sometime this year.

My question is can I transfer this mortgage to my next house? I thought we could due to it being CAT standard but I phoned Abbey up and was told this would be classed as a re-mortgage and couldn’t be transferred to a new house. Are they right or just trying to get me onto a higher interest rate?

I was hoping to transfer this mortgage over and then get a new mortgage for the extra money we would need. In affect I would have 2 mortgages on the 1 property. Is this possible?

Thanks in advance for your help

herbiesjp

What Abbey has told you is wrong

Moving house is not treated as a re-mortgage.

If you want to port your mortgage across you will be able to, assuming you have a portable mortgage product. The porting is treated like a brand new mortgage application, and you will have to meet the current Abbey lending criteria for this mortgage and the top-up. There are no guarantees with porting i.e. it does not have to granted if you fail to meet the criteria.

If it is portable, then you are indeed right that you port the current balance and top-up with a current deal. You would have two different mortgage rates on the property

Toki

Thanks, I will phone Abbey again tonight to find out if the mortgage I have is portable. I was under the impression that all CAT mortgages were portable? Not sure if that is right?

Thanks again.

mkcj

According to this site a CAT mortgage is portable :-

http://www.streetdirectory.com/travel_guide/195047/mortgages/glossary_of_common_terms_used_during_the_mortgage_process.html


"CAT marks/standards - CAT stands for Fair Charges, Easy Access and decent Terms. They were created by the Government in an attempt to provide consumers with simple, clear financial products with straightforward, easy to understand terms. A CAT mortgage will have no arrangement fees, no redemption fees and will have interest calculated daily. It will also have a minimum loan of just £5000, offer you repayment flexibility and the mortgage should be portable should you move home. Finally, you will not have to buy the lender's insurance products and there will be no penalties should you find yourself in arrears but can subsequently catch up."

Toki

I thought I read that somewhere. Im just back in the house and Abbey phone lines shut at 8pm but I will phone them tomorrow.

Thanks to herbiesjp and mkcj

jill2002

Abbey CAT mortgages are not currently portable due to systems issues. However, you will be able to port onto a special deal (PORT8) that will be the same rate or better. There will be no fee to port this mortgage. If you need to borrow funds over and above this amount, you need to take a further deal to run alongside PORT8, or you can choose to have a new deal on the whole of your mortgage - although it is doubtful that you would want to do this as it is such a good rate currently. The PORT8 deal still has no tie in and tracks the Bank of England rate, as your CAT standard mortgage did.

If you are borrowing less, then you will just take the PORT8 on the whole of your new mortgage when you move and will just need to pay a valuation fee.

You were originally told that it would be a remortgage, this was correct previously for the CAT standard mortgage when taking an additional loan. But now Abbey have partially sorted the system issue out and the 'special deal' PORT 8 is used. This would never have been correct for someone moving home.

Hope this helps. If anyone tells you anything different than this (and it is not a well known fix) they need to check the Temporary Contingency procedures in the Mortgage Manual on Bookstore.

Toki

Thanks very much jill2002 for your information,

I have phoned Abbey again (prior to reading your helpful comments) and they say my CAT mortgage is not portable. They never mentioned PORT8 though. I checked with the FSA and I was wrong in my original thinking that all CAT mortgages are portable it depends on each lenders product I was told.

Hopefully the PORT8 deal will still be available once we find a house!

jill2002

They have to make an alternative deal available. Previously, you were able to port the CAT mortgage onto the Flexible mortgage, but as this is not available currently, they had to bring out another deal to make porting possible.

alm721

We are in the same poistion but with Woolwich, we have a really good rate at present and the mortgage is portable and we have just sold our house (finders crossed)! Assuming all goes to plan and we want to port the mortgage is it a case of doing a new application? The ltv etc is about 50% maybe less which is better than our current one. The problem is in the last couple of years I have resigned due to being unable to reduce my hours after having my son. I am though actually still at my old place of work but am classed as supply (I'm a teacher) and have no contract although I've been doing a regular 3 days a weeks since I resigned. I'm worried this will affect our application as when we took the mortgage I was full time. Our credit rating must be very good. We have no debts other than the current mortgage, we use one credit card each which is paid off in full everymonth and apart from one card payment a few years ago have never been late with a payment. Will this make up for the fact that I'm not in permanent employment? Also we may want to borrow around another 30K. I know this would be a different product but wondered whether trying to borrow the money elsewhere rather than on the mortgage may make it less likley that they will do a full application (i.e if we are moving to a more expensive house without wanting to borrow anymore money and have a good credit rating are they less likely to do a full apllication) or will it make no difference anyway?
Sorry its long and thanks in advance