House swap and house sale

bodone

[FONT=&quot]Hello All,

Myself and my partner have two properties, each in our own names. We have agreed to swap our house with another vendor and for us to pay a cash difference. My partners house has been put up for sale and priced at a level we've been advised will shorten any sales cycle (but who knows!)

On the house we are swapping, mine, there is an outstanding mortgage, that will need extending to cover the payment we are giving the people we are swapping our house with. Once Lucie's has sold we will be taking the equity from that and taking it off the new mortgage.

We are trying to do this at a minimum cost, so looking for the first mortgage, that will be relatively short term to be as low as possible, with minimum early repayment charges.

Anyone have any recommendations as to who to talk to for best offers? Currently with my equity we will be at 89% LTV, once we sell Lucie’s we will be around 60%. Budgeting per month, we can afford the new house without having to sell Lucie’s, just in case we don’t sell quickly.

Thanks for any help and advice.

Stephen[/FONT]

kingstreet

there is an outstanding mortgage, that will need extending to cover the payment we are giving the people we are swapping our house with

So, you're planning to go back to your existing lender for the new mortgage on the new property? Are you porting a good rate?

I'm not sure if I'm correct with this, as later you say;-

who to talk to for best offers?

so I'm a bit confused.

You're going to sell this property and repay the mortgage. You're going to need a new mortgage for just under 90% of the purchase price of the new one you're buying. Is it worth looking at transferring the rate from your old mortgage to the first part of the new one, with a new deal on the extra money you're borrowing?

We are trying to do this at a minimum cost, so looking for the first mortgage, that will be relatively short term to be as low as possible, with minimum early repayment charges.

Minimum cost? Fees or monthly payments?

"Relatively short term" means higher monthly payments. Do you mean a long-term mortgage which you hope to reduce in the short-term?

bodone

Sorry, i should have explained more clearly. We will be paying off the existign mortgage and startign a new one with a new Vendor. Once we sell Lucie's house we will have £80k in capital, so will likely look for another new mortgage that offers a better rate than the first one due to the much better LTV 59% rather than 89%. I'm new to this, so maybe I'm going about it completely the wrong way, I'm just lookign at it in terms of lowest costs for getting a mortgage and then possibly ending one early.

Thanks

Thrugelmir

Can Lucie afford to fund both mortgages concurrently? Until her property is sold. This may impact a lenders decision.

bodone

Yes Lucie can afford both and I can afford the new mortgage at it's prelimanry full value on my own too.

stephen

kingstreet

It sounds like you're looking for the best 90% mortgage with no/low set-up costs, no early repayment penalties and the lowest rate?

bodone

Absolutely, summed up better than i could.

kingstreet

If you don't have a broker, have a look around the comparison sites. Typically a Lifetime tracker will have no early repayment penalties and the fees/costs may be lower from one lender to another.

If you try to figure out how long this might take, it'll tell you whether you're better off paying lower set-up costs, or getting a better rate. You'd expect the better rate to save you money if you end up with the mortgage over a longer term. If the other property sells in a few months, saving money on the upfront costs would be a better idea.