Looking to move, port current mortgage and additional borrowing/2nd mortgage

sjpanther

Hi, hopefully someone could advise/help. My partner and I are looking to move to another property. We have been on our current mortgage for nearly 2 years, its fixed for 5 years, so we need to port it across to the new property to avoid paying early cancellation fees.

Our house likely sale price (minus fees/costs etc) - £135,000
New property sale price - £160,000
5 Year Fix Mortgage balance - £111,000

We will need to borrow additional money from the bank, to fund the gap.

We know that we could approach our current lender and ask to borrow the additional money on a separate deal, but my question is can we approach another lender for a "2nd" mortgage on the new property?

Has anyone done this before?

Thanks in advance for your help :-)

kingstreet

No. You take out a mortgage for the whole amount you need with your existing lender. Part of it will be on the transferred rate, the extra borrowing can be on whatever product you can choose from your lender's current product range.

It may be advisable to go for something which will re-sync the products in three years time when the current fix ends. This way, you can transfer to a new product for the whole mortgage, or remortgage to a new lender without worrying about timing.

Please remember, porting is transferring the rate, not the mortgage. Your current mortgage is paid off and a new one raised on the new property. You must satisfy the lender's terms and conditions once again, as the new mortgage is not guaranteed.

Technically, you could do what you are suggesting, which is a mortgage with your current lender and a secured loan/second charge with a another lender but this will result in you signing up to a higher rate and possibly worse T&Cs than you can get by staying with your current lender for the whole mortgage.

sjpanther

Thanks for your help and advice. Much appreciated.