Moving house - how would a new mortgage work?

iandv

Hi

We are currently Coventry BS mortgage customers on a fixed rate deal of 4.50% fixed until 31.12.11.

We have put an offer in on a property and would need to borrow another £62,000. What rate would the extra £62,000 be at?

Or would we just start a new mortgage account of 3.75% fixed until 31.3.12 for the full mortgage amount of £125,000?

Otherwise we would have 2 mortgage accounts with Coventry which I dont really want as it would be more expensive per month, rather than just having one mortgage account?


We would have one account with
£63,000 @ 4.50% until 31.12.11.

and a new account
of £62,000 @ 3.75@ until 31.3.12

What is the best option, as this is all quite confusing!

beecher2

If you don't want to have two separate rates then you'll need to pay an Early Repayment Charge to get out of your deal. Have a look at your mortgage offer or statement to see how much that'd be, and also check if your mortgage is portable. It isn't an automatic right so salary multiples, credit files and LTV would all have to stack up. Contact your lender ASAP as you've put an offer in without knowing for sure if you're in a position to move.

iandv

The LTV value is fine and I spoke with Coventry a few months ago so I know that the amount we need to borrow would be available based on our earnings.

Our current mortgage is portable and the early repayment charge is £2,547.

What would be the most cost effective / best option? to have the two seperate mortgage rates or just have the one mortgage account?

VIGILANT22

ask the coventry for quotes.........

iandv

Thanks, will do in the morning.

Would I be able to negociate on the early repayment fees on my existing mortgage with Coventry to only have one mortgage account on the new loan, especially if I keep my business with them rather than transfer to another lender?

VIGILANT22

who knows...normally no...no lender is bothered about business retention...they would rather not lend!...but you can ask...

MarkyMarkD

Assuming that the original mortgage has a standard 3% ERC then it will be around £1,800. It's not in any lender's interest to waive an £1,800 ERC. They don't owe you anything so they aren't going to pay you to stay, instead of getting £1,800 for letting you walk.