Need help regarding mortgages

wazaaap123

Hi everyone,

We bought our first house last year on a fixed rate 3 year mortgage. it was £180k if i was to sell that house next year (2years into the fixed rate) for £220k and bought a house for say £140k what would i have to do with regards to mortgages?

Would i have to pay to get out of my mortgage that i have at the moment? even if i wanted my new lower mortgage with the same bank?

kingstreet

In your mortgage documentation, you should be able to find out if the mortgage is portable. If it isn't, you'll have to pay any early repayment penalties when you sell, regardless of whether you stay with the current lender. You'll need a new product as well.

If portability is mentioned, you will pay off your existing mortgage when you sell and take out a new mortgage with your current lender. Your current product will be transferred to your new mortgage for the remaining term you have left.

If the amount of your mortgage is lower then your current one, there will be an early repayment penalty charged on the bit you have reduced by.

Remember - portability is not a guarantee of a new mortgage. You have to satisfy the lender's criteria and status requirements like you did before, but they may have changed since then. You have to be able to qualify for the mortgage, then can your product be transferred.

wazaaap123

Thanks for this - it is most helpful!