Santander NOT SO Portable Mortgage

mik194

Thirteen years ago I took out a mortgage with Alliance & Leicester (now Santander) on a very favourable 0.99% above base Tracker. One of the deciding factors in choosing this mortgage was the fact that It was portable and providing I met the criteria, (namely the loan to value% of the property I was moving to) then I could move the mortgage (or at least the rate) to the new property.
In the last thirteen years we have ploughed thousands upon thousands of pounds into the new property to enhance and extend it. We now wish to downsize and release some of the money we have poured into the property over the years.
Despite being told by Santander on 2 occasions in the last 18 months that it wouldn’t be a problem when we actually tried to port it we were told that because we wanted to retain more than £50,000 in equity the portability was no longer valid, this was evidently a new “internal policy” so they couldn’t give me the details.
I have my personal and business accounts with Santander and over the past 13 years I have never made a late payment, I don’t have any other debt or finance on anything, pay my cards off monthly and because we are downsizing my outgoings will be much less. With the new house we would have a LTV of 62%, well below the required 90%.
Because of this “equity retention policy” I have to go through all the affordability checks and as a result they are offering me less than half of my original mortgage.
Surely this is a blatant move to stop me having such a favourable rate? I don’t believe they are honouring the product I bought. I am planning on complaining to the Financial Ombudsman Service (FOS) but that will take months and we want to move.
Has anyone else had a similar situation? What can I do? Please help?
All I want to do is keep everything the same and move house pulling back out the money I have invested over the years, this has upset myself and my whole family and could ruin 18 months of planning and trying to move house.

mrginge

There is no such thing as a portable mortgage.

Regardless of this new policy you would need to qualify for the new mortgage based on current affordability rules. Since it appears the new mortgage is unaffordable then you have rightly been declined.
Unless of course you can produce your original mortgage documents that guaranteed you would be accepted for any new mortgage in the event of ou wanting to move to a new property.
Can you produce them?

Thrugelmir

While your Santander bought A&L. Your mortgage remained with A&L as such. A&L don't underwrite new business. So the new mortgage will be with Santander. Santander cannot port an A&L product onto their mortgage books.

While it may seem unfair. A&L was taken over due to their poor financial situation. Santander are honouring your existing product but have absolutely no obligation to continue to do so if you move house. That's business. Lenders aren't charities.

Caz3121

mik194 wrote: »

Because of this “equity retention policy” I have to go through all the affordability checks and as a result they are offering me less than half of my original mortgage.

I am not sure that is the only reason, you would have gone through the same affordability checks if you were taking equity

mik194

I have the original mortgage documents, it states..

What happens if I move home?
Your mortgage is "portable" which means that if you move house, you can transfer your mortgage to another property, subject to terms and conditions. Please refer to schedule 2 of the Mortgage Conditions...

and Schedule 2 mainly talks about the initial discount period but has a convenient paragraph stating they may refuse the rate if I do not meet their lending policy or requirements at the time you make your choice. So I guess that covers them?

...and 13 years of faultless mortgage payments, no other loans and a top credit rating says I can afford it.

Thrugelmir

mik194 wrote: »

I have the original mortgage documents, it states..

What happens if I move home?
Your mortgage is "portable" which means that if you move house, you can transfer your mortgage to another property, subject to terms and conditions. Please refer to schedule 2 of the Mortgage Conditions...

and Schedule 2 mainly talks about the initial discount period but has a convenient paragraph stating they may refuse the rate if I do not meet their lending policy or requirements at the time you make your choice. So I guess that covers them?

...and 13 years of faultless mortgage payments, no other loans and a top credit rating says I can afford it.

A&L no longer exists. They no longer write new business. End of story.