Port mortgage advice

mgsgray_2

Hi all,
Can someone advise as i am pulling my hair out.
I have sold my share of a shared ownership property for 86k. the remaining morgage on this was 33k.
I have ported that 33k to my new property and increased the borrowing. When Nationwide discussed it they said that the morgage would transfer and therefore i would not need to pay of the old as the debt has moved.
Now solicitors are talking about redemption figures of 33k. If i have to pay this of i am up the creek as the money was set aside to clear all existing debt.
Any help greatly appreciated

kingstreet

This is my portability standard text. It is so widely misunderstood, it was necessary to do this.

Portability is the ability to transfer the rate from one mortgage to another when you move house.

In practical terms, you have to approach your lender for a new mortgage on the new property and satisfy their current criteria and status requirements. If you are borrowing more, the extra money will be on a choice of the lender's current products, with the current rate ported to the existing amount you owe for the remaining time.

Try to match the new deal (if you need one) with the time remaining on your current deal so you know you can move the whole mortgage to a new deal or new lender at the same time.

Remember, it is not a guarantee of a mortgage, merely the opportunity to see out the original offer.

The solicitor is correct. Your old mortgage will be repaid from the sale proceeds. Explain what you mean about the debt repayment.

mgsgray_2

Kingstreet, many thanks

I thought that the 33k outstanding simply transferred to the new property and would need to be paid of through the term of the mortgage

Regards

kingstreet

You aren't giving much away, so I'll have to produce an example.

£86k share, less £33k mortgage = £53k equity, less any fees.

New mortgage application to Nationwide;-

Purchase price £150,000 (example)

Deposit £20,000 (example)
Debt repayments £31,000 (example)
Fees paid £2,000 (example)

Mortgage required £130,000

Part one of mortgage = £33,000 on ported rate
Part two of mortgage = £97,000 on new rate.

HTH