porting a mortgage over to a new property:

searcher30

we have a mortgage and looking at porting this over to a new bigger one. we have some equity and we are self employed. our salaries have not gone up but we plan to offer self catering facilities/b & b within a section of the house which will cover for things. i imagine this will be a self cert mortgage. can anyone provide any tips or what to look out for. thanks in advance.

regularsaver1

porting - means using the same lender as now to move your existing mortgage to a new property

who is your existing lender? have you asked them if they will mortgage a property for both residential and commercial terms?

AndrewSmith

searcher30 wrote:

we have a mortgage and looking at porting this over to a new bigger one. we have some equity and we are self employed. our salaries have not gone up but we plan to offer self catering facilities/b & b within a section of the house which will cover for things. i imagine this will be a self cert mortgage. can anyone provide any tips or what to look out for. thanks in advance.

When porting most mortgages you will be subject to full underwriting as it will technically be a new mortgage account but based on the ramaining terms of your existing one. It is never to be taken for granted that you will be accepted and you will still have to meet the lender's criteria for the ported mortgage.

So many times I have had people say 'you are wrong, I can simply take the mortgage to another property like my adviser told me' only to come back and admit i was right once their existing lender has declined the application.

Remember it is not the mortgage you are porting but the remaining terms and conditions attached to your existing deal. You may still be subject to an arrangement fee and valuation fees.

If you took the mortgage out initially on a full status fully employed basis then the lender will want you initially to still meet this criteria. You say about using self cert, the lender may not accept self cert, or if they do it may carry a loading on the interest rate.

I would rather be honest with you and realistic as opposed to patronising you and telling you that 'it will be a done deal'. Quite clearly a lot may have changed in your situation thus it could be far from a done deal.

Re B&B:

Be very careful on this. B&B carries very strict guidelines relating to planning permissions and fire regulations which must be adhered to. Also your lender may not allow you to operate part of the property as a B&B as they may then deem it a commercial property in part, which they may not lend on. There are also ramifications with insurance on the building and contents.

regularsaver1

As always Andrew Smith - in detail and to the point (unlike mine, he he)

AndrewSmith

Aww shucks, I am humbled lolol

regularsaver1

like you said though - portability is not g'teed - it depends on new application criteria being met