Porting mortgage to move house but have to pay off debts first?

geogrie

We are moving house and wanting to port our existing mortgage to the new house. We want the same terms and the same amount and will be paying off all our debts with the equity. Also we will be putting down 100k deposit. Santander have today said that we need to sell our house first, pay off the existing mortgage and clear all debts and then apply for a new mortgage. This will mean us losing the house we want and also having no home whilst we wait for a new mortgage application to go through. Is this right??

Thrugelmir

Sounds as if Santander are politely declining your new business.

ACG

When i used to work for a different lender, porting was treated as a brand new application and just like a new customer.

kingstreet

Usually, your new mortgage application for your new property is processed while the sale of your current house is progressing. At the time the sale completes, the purchase of your new property completes at the same time.

You would then have some of the equity kept back by your solicitor to pass on to you so you could clear your debts. However, Abbey/Santander believes you won't pay off your debts and will have just as much debt as you always have. So they will probably "tax" you the monthly cost of those debts to cut the amount you can borrow for your new mortgage.

I'm beginning to wonder if Abbey/Santander has taken leave of its senses...

I suggest you consider looking for an alternative lender, otherwise, as you suggested, you could end up with nowhere to live while you attempt to form some understanding of your lender's current attitude to what's supposed to be its main reason for existing - mortgage lending.

Thrugelmir

kingstreet wrote: »

I'm beginning to wonder if Abbey/Santander has taken leave of its senses...

Not if the existing interest rate is costing Santander money.

Better to lend to a new customer.

kingstreet

Some of the absolutely mental strokes they are pulling during the application process absolutely defy belief. Brokers I've known for years who have used them religiously (as have I) are now talking about them as "lender of last resort" and having to charge a fee, or an increased fee, for clients wanting to use them.

ViolaLass

If you're putting down a £100k deposit and you're going to use equity to pay off debts, why not use the deposit to pay the debts?

Thrugelmir

ViolaLass wrote: »

If you're putting down a £100k deposit and you're going to use equity to pay off debts, why not use the deposit to pay the debts?

Equity is in the house?