Porting and borrowing more

stevefen23

Hi

I currently have an 95% ltv mortgage with Halifax that has an epc of £2750 till feb 2014,the flat we are in is prob worth £90 to £94 thousand with £85000 remaining on the mortgage. We need to move due to having our first kid and we need space. We are fixed at an eye watering 7.14%. Can I port this mortgage and borrow for instance an extra £40k? We have £16000 deposit for a new place. Would I only need a 10% deposit for the additional borrowing if Halifax allow it?

Many Thanks
Steve

_Andy_

What is the purchase price of the new property?

stevefen23

We haven't put an offer in on any house at the moment,we are currently doing up the flat in preparation for selling it. I am in Scotland and we have seen houses around the £140 to £150 thousand mark that we would hope to afford.

kingstreet

Should be ok if your incomes/affordability are right and you're credit worthy. You put in a new application for the full amount you need to borrow and Halifax will transfer the existing rate over on completion day, for the amount you owe. The extra can be taken on one of their current products.

stevefen23

So if I borrowed an extra £40k would I only have to put a minimum of 10% of the £40k?

Thanks for your help

Dave_Ham

Sorry just playing devils advocate;

Would you not be better off obtaining consent to let from Halifax and renting out the flat.. I do not know the local market but nationally rental market is booming..

Then take a 90% mortgage on the property, where you will have no chain, not lose out with current economic climate and importantly get a better rate than the eye watering 7%+ you have on the bigger of the then 2 mortgages and cheaper repayments..

Just a thought for you...

Yorkie1

To port a mortgage, you first have to meet the relevant lending criteria for the new property / price, and then you 'port' your existing mortgage rate for the outstanding balance of your mortgage, and have a different rate from the same lender for the new lending.

Do you really want to transfer across your 7.14% rate??

stevefen23

Yorkie1 wrote: »

To port a mortgage, you first have to meet the relevant lending criteria for the new property / price, and then you 'port' your existing mortgage rate for the outstanding balance of your mortgage, and have a different rate from the same lender for the new lending.

Do you really want to transfer across your 7.14% rate??

Not really but it'll cost me £2750 to get out of that fixed rate. I would have to get £88k for the flat to break even and that's before solicitors fees etc.

stevefen23

Dave_Ham wrote: »

Sorry just playing devils advocate;

Would you not be better off obtaining consent to let from Halifax and renting out the flat.. I do not know the local market but nationally rental market is booming..

Then take a 90% mortgage on the property, where you will have no chain, not lose out with current economic climate and importantly get a better rate than the eye watering 7%+ you have on the bigger of the then 2 mortgages and cheaper repayments..

Just a thought for you...

I wouldn't even know where to start with letting,I don't think the rental income would be enough to pay the mortgage. It would be nice to have somebody else paying for my flat but at this moment I'm just wanting to move my family into a bigger house. I don't know if Halifax would let me rent it out.

Dave_Ham

Hi - I am not trying to convince you here, just giving options.

Halifax are likely to let you and imagining you are on repayment mortgage, it may be there or there about.

Was just an out there idea, you don't pay erc and become chain free which should save you about £5k on the ongoing purchase..

Give the economic climate, many accidental landlords have come up in last couple of years.

If this is not an option, at 7% you may be better paying ERC and getting a better rate and starting again...

Thrugelmir

How old is your kid?

Can you afford to make overpayments on your current mortgage?