Sold house, haven't found new one, need to port mortgage to avoid early repayment fee

GEM1903

Hi, wondered if anyone has any ideas on how we can round our sticky situation. We have decided to sell our house (and have a buyer keen to move fast) and downsize so we can reduce our heafty £300k + mortgage. We have a fixed rate deal of 4.69% with 3 years to run and have just enquired about the terms and been told that there is a £17k early repayment charge. We haven't found anywhere we want to move to, and although we are happy to move into rented, we need to port our mortage withibn 3 months to avoid being £17K worse off (which is very risky and stressful!). We can currently make overpayments, but they said we can't do that if we are moving house - does anyone know of a way around it so we can complete on our sale quickly without taking the risk of having to pay the penalty?

somethingcorporate

What is to stop you finding a new house? isn't the obvious solution to get house hunting?

£17k is a massive repayment penalty but it is there in black and white in the contract that you signed up to so getting the mortgage company to waive this is not going to happen. You need to do what you have to to minimise the chance of you paying it!

We were faced with something similar but fortunately we had 6 months in which to find a new house although we did have to pay the ERC upfront and then get it refunded when we found a property.

Good luck!

kingstreet

Don't forget you have to satisfy the lender's current criteria and loan to value requirements for a new mortgage before you can port anything.

If you think your current lender won't give you a new mortgage, paying the penalty is your only option.

If they will lend the reduced amount you need, you're also going to have to pay a proportionate penalty on the amount you're repaying early.

As sc says - you'll have to pay the full penalty and get some/all of it back if you take the three months option.

If you can, pay the mortgage down using your savings before you complete the sale. ie - If they will let you, use the (eg)10% capital repayment facility using your savings to reduce the penalty payable.

GEM1903

Thanks for this - finding out how much we can pay on the capital repayment facility is the next step now I guess!Just wondering if taking out a short term loan and using it to pay some off be allowed/viable?