Options for extending mortgage amount

smartmove07

Hi,

I am on a 3 year fixed rate deal with Halifax which is due to end August 2013. I am considering purchasing a larger property possibly as early as next year but I am wondering what my options are. I currently owe £170k on my Halifax mortgage but would want to increase the amount borrowed by around £100k (£275k mortgage) still keeping just under 75% LTV. I haven't yet enquired directly with Halifax as to my options as I am only casually considering it but I was wondering what you good people would advise?

Thanks in advance.

Thrugelmir

You've given limited information. So difficult to comment.

However I would suggest stress testing your budget. With a debt of that size would affordability be an issue if interest rates hit 7%, for example. Only you would know if that was a comfortable level of commitment.

kingstreet

Your current mortgage product may be portable. This allows you to avoid any early repayment penalties

If your current rate is portable it will be mentioned on the KFI and on the offer from when you took it out. 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.

Alternatively, you might like to consider a whole new mortgage product with Halifax or another lender by paying the current early repayment penalties, but the new deal would have to offer a lot to make that worthwhile.