Can I remortgage by porting an interest rate?

Oxid8uk

Hi everyone, after a bit of advice.



Current mortgage details:

• Main residence – HSBC tracker, unlimited overpayments and no early redemption fees. Tracks 2.69% above BoE rate.
• Rental property – Nationwide residential mortgage with consent to let. Early redemption period ends Dec 2012. Tracks 0.34% above BoE rate but with a 2% floor. Current interest rate is 3.84% as an additional 1.5% has been added for the consent to let (so without CTL current interest rate would be 2.34% - this rate would remain until the BoE rate exceeds 2%). Mortgage terms are portable.

In the next year or two I am looking at selling my rental property. Although it currently pays for itself, in 2 years time I will have to apply for CTL again and Nationwide may decline due to me having purchased another house since getting my original CTL. I would then have to switch to a BTL mortgage which would cost considerably more a month than my current consent to let rate and the rent I get is unlikely to cover a BTL mortgage payment.

So my question:

The Nationwide mortgage I have has a far better rate than my HSBC one therefore on selling my rental property would I be able to remortgage my main residence by porting over my Nationwide rate? I would also need to take out additional borrowing to redeem the entire HSBC mortgage.

Affordability wise there shouldn’t be any problems. Salary much higher than when I originally took out the Nationwide mortgage, credit score is in the excellent category, no defaults, additional borrowing will be in joint names, overall LTV would be in the region of 65%.

I know I could talk to Nationwide about this but I am wary about informing them of the additional mortgage I have taken out since they gave me CTL until I decide what I am going to do with my rental property.

Thanks in advance.

Simon_gloster

Porting a BTL CTL to a main residence is usually not allowed.

Oxid8uk

Simon_gloster wrote: »

Porting a BTL CTL to a main residence is usually not allowed.

But I wouldn't be porting a BTL product - it is a residential mortgage which has consent to let. If I stopped renting out my property and moved back into it the mortgage would revert back to the original residential mortgage terms with a rate of 0.34% above BoE rate (this was confirmed by Nationwide when I applied for CTL). That is why I am wondering if I would be able to port this rate but rather than buy a new property I use it to remortgage my main residence.

holly_hobby

You can not "port" an interest rate product to a property already owned - it is for new purchase only, only if borrowing with the exist lender, and at the complete discretion of the lender ie they do not have to permit any portability.

So, to answer your Q - no you won't be able to switch your borrowings and mge product between already held properties.

Hope this helps

Holly

Oxid8uk

holly_hobby wrote: »

You can not "port" an interest rate product to a property already owned - it is for new purchase only, only if borrowing with the exist lender, and at the complete discretion of the lender ie they do not have to permit any portability.

So, to answer your Q - no you won't be able to switch your borrowings and mge product between already held properties.

Hope this helps

Holly

Thanks Holly. I didn't think it would be an option. It will just be such a shame to lose such a good rate but hey ho, that's life!