Downsizing advice

MYERE

Hi

If I downsize to a smaller / cheaper property, can I stay with my current mortgage company? Santander? Will they need to go through a new application or simply transfer my mortgage?

My house is valued at 350000 with 260000 outstanding giving me 90000 equity but I also have about 30,000 of debt. I would like to clear my debts and put the balance as a deposity on the new house which I could get for 270000.

Thanks

kingstreet

You need to apply for a whole new mortgage for the £210k (ish) you appear to need to borrow. This will be subject to you meeting criteria and valuation as it was when you purchased your last home.

If your current mortgage rate is portable, you may be able to transfer it to the new mortgage, but if an early repayment penalty applies you'd have to pay it on the £50k you are reducing your mortgage by.

desert_rose

I'd set up an appointment with your local branch and ask them what the usual procedure is if I were you. All building societies and banks have their own rules, regulations and charges - but with the equity that you do have, I'd be inclined to get some quotes from a few other lenders first then do a comparison once Santander have given you theirs.

There are all sorts of weird and (not so) wonderful charges out there so do read the small print very, very carefully.

Downsizing usually means getting to a point where you're mortgage free with a smaller, more manageable property with fewer outgoings. Is there any way that you can achieve this before tying yourself to another hefty mortgage?