How do I move house?

Little_Miss_Penny_Less

Hi all,

This is going to sound really stupid I know... but as you were all so helpful last year when I was a FTB, I know you can help me now that I want to be a first time mover!

Right... we bought our first home last year but now I would like to look at moving again (I know some of you will think I'm mental! But there are personal reasons behind it, and no... nothing to do with hating the neighbours or anything!).

Soooo... What would I need to do mortgage wise? We have a 3 year fixed rate, so would we need to see with the lender about getting more money attached to that mortgage (the next house could be c. £50K dearer! )
If we remortgage (I'm guessing this is the correct term) will our interest rate change?

Sorry if it seems a really daft question... but it's like Chris Tarrant says, it's easy when you know the answer!

cattie

As you're on a fixed rate there may be penalties if you move, by way of early repayment charges. You would need to read your mortgage documents & read the terms of the mortgage to determine this.

You also need to find out if your mortgage is portable. If it is then it probably should be just a case of applying to your lender for a higher amount along with porting. If it isn't then it will be a whole new mortgage & you could have application fee's to pay on a favorable rate mortgage.

Perhaps if you could post a few details of your current mortgage & earnings then one of the more experienced posters here will be able to tell you whether you'd manage to get an extra £50k over & above what your current mortgage is.

Little_Miss_Penny_Less

Thanks Cattie, I'm pretty sure the mortgage is portable (will check when I get home!)...

Current mortgage:
£158,000 - Nationwide repayment mortgage at 5.4%
Earnings - 1st borrower £33,000 - 2nd Borrower £31,000
Other debts - £10k car loans

House prices have continued rising round our way too, so hopefully the house is now worth about £175,000 (bought for £164,000) but not counting on it!

Tiger_greeneyes

Probably the best thing you can do is to find an IFA who can look into what mortgage you've got at the moment and what you'd need to do next - and can tell you all about how much it will cost - and give you an idea of how much more you can borrow.

It really depends on the terms of your existing mortgage as to what the best solution is.

Remortgaging only happens when you're changing your mortgage on your existing home

Leon_W

Penny Less

First port of call is Nationwide. The 3 year fixed rate you don't really want to be messing about with as there would be Early Repayment Charges payable if you redeem it. So leave that part untouched and "port" it to you new home.

Now, the extra borrowing. You are at the mercy of Nationwide, so if they refuse to lend you the extra then you may have to move elsewhere and take the Early repayment Charge on the chin.

If they agree to lend you the extra then you still have to be careful !!!

You will now have two different mortgage products running alongside of each other. Your existing loan + the new one. The trick is to try and get the end dates on these to pretty much co-incide with one another as you could end up paying Standard Variable Rate on part of your loan for a long time.

ie: If you are 1 year into a 3 year deal then it would make sense to take the extra borrowing on a 2 year deal so the end dates are pretty close. imagine the problem if you took a 5 year deal for the extra, your original loan would fall onto the standard variable rate AND YOU STILL WOULD BE TIED IN !!

Little_Miss_Penny_Less

Excellent comprehensive advice Leon! See I knew this was the right place to come! Will speak to nationwide and see what I can suss out!

Thanks all!

Leon_W

Well click on the "Thanks" button then !!!!...LOL !!!!

Best of Luck !

Little_Miss_Penny_Less

sorry! forgot to click in all my earlier excitement! ;-)