Cashflow when moving house

Minitache

Hello all,

Couple of very stupid questions, but can't find answers on online guides!

I'm considering moving house to somewhere substantially cheaper than my current house (from 450k to 400k or so).

Hopefully in the long run this will save money, but I'm not sure how the cashflow works. If I buy and sell at the same point, in the normal sort of way, can I cover all of the following out of the £50k cash left from moving to a cheaper place?
- Estate agents fees (surely these are built in to be paid out of the sellig price?)
- Stamp duty
- Lawyers fees etc.

Also, my mortgage (runs out in 2017) is obviously secured on my current house. Will it be uncomplicated for it to be secured on my new property? Hopefully it should help that at the point I got out the mortgage my house was worth substantially less than £400k (silly London house price increases!)

Thanks in advance for any help!

G_M

If using a conveyancer, you will normally receive a 'Completion Statement' a few days before Completion.

This will show all the expenses they have incurred in your sale/purchase, the SDLT, EA fees etc. It will also show the anticipated income from your sale, the cost of paying off your curent mortgage, the cost of your purchase, the income expected from your new mortgage.

At the end will be a final balance of what you owe them (which has to e paid before Completion) or, as in your case, what they will owe you (which they will pay you after Completion.)

Whether you can transfer your existing mortgage product betwen properties, depends on the term of your product. ask your lender.

But the existing mortgage will be piad off and a new one created on the new property. Either using your current product with current lender, or a new product with the current, or a new, lender.

Minitache

Thanks a lot, that's incredibly helpful and reassuring!

I should be able to transfer the mortgage, but not sure what you mean by saying "it will be paid off and a new one created". In some ways that would really suit me, as I'd have a higher loan to value. But would that mean I'll have to pay the early repayment charges on the whole thing?

TBagpuss

it depends. You would need to start by looking at the terms of your current mortgage, and what it says about portability. Then you would need to speak to the lender and ask them.

Some mortgages have built in clauses saying that the mortgage can be 'ported' to a new property. Others don't, so it is down to the lender to decide. It is also, of course, worth looking around and speaking to an independent mortgage advisor to see whether the product you have is one which it would benefit you to keep, or whether you might in fact be better of biting the bullet on the penalty charges and getting a new product.

You existing mortgage is secured on your existing house, so from a technical point of view it would always be paid off, the issue is whetehr a new loan on exactly the same terms would then be be granted and secured over your new house, or not.

Pete9501

It probably cost us £8k to move just before Xmas, downsizing a little to a £230k house. The 10% deposit for your new house will come from the buyers of your existing house and your solicitor will hopefully pay off the estate agent, stamp and their fees out of your £50k. The only early expense will be the search fees which most solicitors want up front but they are only a couple of hundred, oh and removals fees are also separate and need paying before you move.

questionss

If you are porting the mortgage they may be wanting to know your plans for the 40k or so you free up. It may also mean, if you keep your borrowing the same, that you fall into a different LTV category and so your mortgage rate would not be available to you.