Porting mortgage - how much will the new loan be for?

JimmyTheWig

holly_hobby wrote: »

So as you can see, whether (as in this example) you choose to utilise the extra 2k (or whatever) available to increase your deposit, and therefore reduce the new borrowing, is your choice - if you don't want to do that, thats fine - but do remember that its a see-saw, so if you choose not to take the opportunity to borrow less, you will effectively incur interest that otherwise you would be able to avoid (although on 2k or a similar small amount, it would be neglible over a medium to long term arrangement).

Ah, but Holly, I know something that you don't.
My interest rate on loan 2 (what I have been incorrectly calling "new borrowing", though I understand that the whole thing is new borrowing) is lower than the interest rate on loan 1.
So it is in my favour to maximise loan 2 and then, when the money ends up in my bank account, make an overpayment on loan 1.