Question about Porting - fixed periods

Angie_B

Hi all,

I was wondering if someone could help me. I understand the principle behind porting but cannot seem to find the answer to what happens to the fixed period if you port and then have an extra product to top up for increased borrowing.

So, for example, say I have a current mortgage of £150k which is 2.5 years into a 4 year fix but, due to a change in circumstances, would now be able to 'upgrade' my flat to a house.

I am currently with Nationwide and their calculator says I can borrow up to £300k. LTV would be around 65% (so house value around £475k). So that would mean £150k original mortgage left plus an extra £150k new product.

Would the new product run to the same end date as the original fix, i.e. for another 1.5 years, or would the new product have it's own fixed period so that the two products would run on separate fixed periods?

If they have different fixed periods, to remortage the total amount onto one product in the future, would you have to leave one on it's SVR and then remortage once the longer fixed period was up? Or are you stuck forever with different re-mortgage dates?

I hope that makes sense - apologies if it doesn't!

kingstreet

The new product will have its own end date, perhaps two, three or five years from completion.

The ported rate will therefore end earlier and revert to SVR or whatever follow-on rate applies to it.

How about taking a penalty-free tracker or similar as your new product, then you can look to take new products for both sub-accounts when the first bit ends?

Angie_B

Thanks Kingstreet. That's very helpful.

I hadn't thought about penalty-free trackers so will definitely be doing my research on those and speaking to a broker before I make any final decisions as to what to do.

Angie_B

Sorry, I have one more question with regard to how porting works in practice if you are topping up.

Say I ported the existing £150k on its existing rate (3.39%), how is the rate for the second £150k worked out, please? Is it on the rate you would get on the entire thing as if it was a new mortgage, i.e. on the current rate for a 65% LTV (£300k on a £475k house) or is it something more complicated?

I am trying to work out if it even worth me pursuing putting my flat on the market etc.

Thanks in advance for any help!

kingstreet

Yes. It's based on the LTV.

EG - Total mortgage amount divided by property purchase price.

Thrugelmir

The additional borrowing would be a currently available product. With the proviso that the ported balance would be factored into any offer.

Angie_B

That's great - thanks so much for all the help. Much appreciated.

Angie_B

Hi all. I called a broker about porting my Nationwide mortgage and topping up and they told me I would need to go to Nationwide direct as I am porting. Is this right? Would a broker not handle a porting case?

And if the right broker would handle a porting case, does anyone have any recommendations for one in the south London region? All of my friends who have bought have all been relatively simple FTB mortgages and all used L&C.

Thanks all!

kingstreet

No, you don't have to go direct.

A broker can produce a porting KFI as long as he has your mortgage account number, name, postcode and date of birth. You use the old system. I did one yesterday.

It's a paper application, which is a minor inconvenience.