Remortgaging part of your mortgage - is it possible?

[Deleted User]

We've got a superb lifetime tracker rate for the most part of our mortgage. Base+1.1%. Not letting that one go!

A few years ago we had some additional borrowing - same lender. So its sort of two separate parts on the mortgage - one at 1.6% and one (was) at 2.95%.

The additional borrowing was a special though and its now reverted back to SVR 4% for that part.

Question is - I dont want to move the main part but can I remortgage just the additional part? I'm guessing not and only option would be to stay with same lender?

Thrugelmir

As a sub mortgage account you can apply for any product that you meet the criteria for that your lender is offering.

DandelionPatrol

In principle, you could get a secured loan and pay off the higher interest component of your current mortgage.

However, the security of any such loan would be of lower priority than the remaining component of the current mortgage. So any lender who would do this is likely to be more expensive than you are paying at the moment.

amnblog

Your Lender should offer you a better rate option for the element that is now on SVR.

[Deleted User]

So I can only stick with current lender? I can't move this sub-account somewhere else?

kingstreet

You can, but the rate will be worse, not better.

Mortgaging is predicated on a first charge over the property. The top quality security. Any lender coming after that first charge doesn't get as good security so the rate is worse.

You need to remortgage the whole lot to a new lender, or get a customer retention product for the later sub-account from your existing lender.

It would help if lenders didn't explain the porting process like someone will have two mortgages. You have one mortgage, one security over the property and the account can be split into several different sub-accounts to reflect different homeloans from different points in time.

[Deleted User]

Ah. Because current lender will only consider £25K minimum (Sub-account is just £18K) then they wont offer anything. So I may be stuck on SVR for this £18K.

Pity because the rest of the mortgage is just 1.6% at the moment. (SVR is 3.99%). I guess one option is to pay off the £18K somehow.

I don't think moving the whole mortgage is a good idea because pretty sure I wont get anywhere near base + 1.1% for term.

One option. Could I borrow an additional £7K (to get up to the £25K mark) to get a new deal? Might be cheaper. Then again I suppose as soon as the balance of this dipped below £25K again when any deal expired I'd be in the same situation!

[Deleted User]

One idea - could I borrow £7K extra on mortgage (to take it over £25K) so I can get a deal.

Then use this £7K to pay off the balance :-)

(Although possibly theres a limit on overpayments per year - no sure)

Thrugelmir

If you can afford to, make overpayments on the higher interest part. As the mortgage balance reduces the bulk of your monthly mortgage repayment will be capital not interest.

[Deleted User]

Thrugelmir wrote: »

If you can afford to, make overpayments on the higher interest part. As the mortgage balance reduces the bulk of your monthly mortgage repayment will be capital not interest.

Does it work like credit cards where the highest interest part is paid off first? I dont think it does..... Pity.

Got a feeling its allocated percentage wise between each part. I think if I make a lump sum then it would be a choice subject to max allowed per year.

somethingcorporate

You should be able to direct your overpayments to a single sub-account of your mortgage. Our nationwide one you can see both elements as separate mortgages we can treat individually.

Who is your mortgage with?