porting mortgage like for like

tumtum141

Hi could someone please enlighten me to what it actually means to port a mortgage. I currently have £40000 left on my mortgage, and found a property for £27000. Does it mean that the £40000 is paid towards the amount leaving £230000 to pay. (does this make sense?)
Please please someone put me out of my misary and explain how this actually work.
Thank you

Cannon_Fodder

I think you mean "found a house for £270,000"...not £27k!

When you sell your current place you will have £X. Say £200k for an example.

The Lender wants £40k to clear the liability on that house, then transfers the mortgage so that £40k will be available to the new property. That just happens on paper really between the solicitor/lender.

So, you have £160k left over from your house sale, as equity. Plus a £40k ported mortgage, puts you back to a total of £200k of funds in hand, leaving £70k to find. This will need a second mortgage.

You don't have to use the same Lender for the second mortgage, but its probably simpler.

Your lender(s) will want to check affordablity, so will check your income supports the total amount involved.

Your solicitor should provide a breakdown on completion, to show how the monies came in and went out, to arrive at a balance owed for fees etc.

Yorkie1

Please note the OP has posted this on two different threads - other is here

http://forums.moneysavingexpert.com/showthread.html?t=513977