What Happens When You Move House?

pineapple80

Hello!

My partner and I got our first mortgage a couple of years ago and our 2 year fixed rate is coming to an end so I'm shopping around for a new mortgage.

I'm thinking of the future and when we might want to move. If we took a 4 or 5 year fixed rate mortgage now, what happens if we want to move before the fixed rate comes to an end? Do we have to pay early repayment fees?

I've been reading everything on MSE but I'm not totally sure what happens so wanted to double check. Thanks for your help!

amnblog

Most lenders give you the option to take the product with you to the new property. If you do not borrow any less for the new property you will not pay any early redemption penalty.

This feature (portability) does not guarantee a mortgage offer as you still have to meet lenders criteria at the time for the new mortgage and the new property needs to be suitable security.

Safe and smart is to set your product term to coincide with a planned move.

pineapple80

OK, I'll take a look into whether we can take our mortgage with us.

Thanks for the advice.

betmunch

pineapple80 wrote: »

OK, I'll take a look into whether we can take our mortgage with us.

Thanks for the advice.

The lender cannot tell you if you can take your mortgage with you as they don't know what your situation or what their criteria will be when you move.


They can only tell you if you can apply to port the mortgage.


I'm only labouring the point as many people think they can automatically move the mortgage, you cant.

pineapple80

OK, I see. That makes it clear, thanks.

ThePants999

Note that the term "porting" is a little misleading. You don't actually take the mortgage with you - technically, you repay and end the mortgage, including paying the early repayment charge, when you sell your house; then you get a new mortgage on the new house. The term "porting" refers to a typical practice whereby a lender will allow your new mortgage to pick up from where the old one left off (in terms of product, rate, term etc), and will refund the early repayment charge if you do that (and take the new mortgage soon after repaying the old one, typically 90-day limit).

Some (maybe most?) lenders will also at least partially refund the ERC if you take a new product instead of porting the old one.

The key thing to note is that since you're getting a new mortgage, you're subject to all of the same requirements and checks re: affordability / valuation etc as you would be if you didn't have an existing one to port, so getting it isn't guaranteed even though you have an existing one with the same terms!