What happens if we bought a cheaper house?

jvpari

We have a £128k mortgage and somewhere around £100k deposit and equity if we sell. How does it work if we bought a property for £200k? There would be £28k minus fees etc

CLAPTON

basically you sell the old and buy the new

so the 128k mortgage is paid off and you choose to apply for another mortgage of whatever size suits you and the lender is willing to give.

00ec25

your numbers are confusing , what do you mean by 100k equity and deposit?
eg: after repaying the 128K mortgage you will be left with 100k cash (ie the house will sell for at least 228k)

so if the future house costs 200k you will need a new 100k mortgage and will fund the remainder using your 100k cash as the deposit, so giving you 50% LTV

PasturesNew

£228k - sell current house
£128k - settle existing mortgage
£100k - into your pot for deposit, fees etc
£8k - fees etc (guessing)
£92k - remaining in pot
£108k - raise new mortgage for this much

Then you'll be paying:
£108k mortgage
£92k from your pot of £100k-fees (£8k)

jvpari

Ok, so we would just have to pay the early repayment fee? We have just under two years fixed rate left

PasturesNew

jvpari wrote: »

Ok, so we would just have to pay the early repayment fee? We have just under two years fixed rate left

ERP
Solicitors, VAT
Estate agents, VAT
Stamp duty on £200k (= £2k)
Moving costs, VAT

greatgimpo

PasturesNew wrote: »

ERP
Solicitors, VAT
Estate agents, VAT
Stamp duty on £200k (= £2k)
Moving costs, VAT

EPC I assume?

Doozergirl

jvpari wrote: »

Ok, so we would just have to pay the early repayment fee? We have just under two years fixed rate left

If it's a good deal or the penalty is high, then you may be able to port your existing mortgage. It works the same as people have described, just with the same lender. They will reduce the amount of the mortgage if you want £100k equity in. If you want money back, then you'd apply for the same amount in mortgag that you currently have and the solicitor will give it to you on completion.

jvpari

PasturesNew wrote: »

ERP
Solicitors, VAT
Estate agents, VAT
Stamp duty on £200k (= £2k)
Moving costs, VAT

I did say "minus fees" at the start...

PasturesNew

greatgimpo wrote: »

EPC I assume?

Maybe, maybe not. Couple come under the "estate agents" part anyway .....

OP's also talked of early redemption, so I'm assuming they might need to pay new mortgage setup fees too .... but we can't spoonfeed people.

jvpari

Doozergirl wrote: »

If it's a good deal or the penalty is high, then you may be able to port your existing mortgage. It works the same as people have described, just with the same lender. They will reduce the amount of the mortgage if you want £100k equity in. If you want money back, then you'd apply for the same amount in mortgag that you currently have and the solicitor will give it to you on completion.

Ok, cheers