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Moving home...confused!
TobyLarone
Posts: 72 Forumite
Hi All
I am a little confused at a few things and I think I confused the person at the end of the phone at First Direct when I tried to clarify some things! so here goes...
Hypothetical numbers to make it easy
Buying a home at £300,000
Currently live in home valued at £200,000
Currently owe £100,000 on existing mortgage
My current mortgage deal expires Jan 2018
Question 1: If I move next few months, will that mean I effectively have two mortgages. My current one with the £100,000 outstanding at my current agreed rate and ANOTHER one at £100,000 at whatever the market rate is at the time I take it out?
Question 2: Can you normally add things like stamp duty, solicitors and estate agent fees onto the mortgage or has this got to be paid up front beforehand?
Thanks for any advice!
I am a little confused at a few things and I think I confused the person at the end of the phone at First Direct when I tried to clarify some things! so here goes...
Hypothetical numbers to make it easy
Buying a home at £300,000
Currently live in home valued at £200,000
Currently owe £100,000 on existing mortgage
My current mortgage deal expires Jan 2018
Question 1: If I move next few months, will that mean I effectively have two mortgages. My current one with the £100,000 outstanding at my current agreed rate and ANOTHER one at £100,000 at whatever the market rate is at the time I take it out?
Question 2: Can you normally add things like stamp duty, solicitors and estate agent fees onto the mortgage or has this got to be paid up front beforehand?
Thanks for any advice!
0
Comments
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When you sell you pay off your mortgage, You take out another on the new place. Fees usually paid upfront.I am not a cat (But my friend is)0
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Question 1: if you are selling your current house, then no, you won't usually have two mortgages. You usually do one of two things. You either a) effectively 'redeem' your current mortgage (ie, pay it off with the money from your buyer) and start again with a brand new mortgage on your new place, or you b) move your your current mortgage product to a new property and extend how much you borrow to cover the new purchase, if the terms of the mortgage allow this.
There are circumstances where you might have two mortgages on one property, however, that's not the usual arrangement; it's up to the mortgage provider agreeing it, and you'd only usually do that for a very specific reason. I had the option to do this the last time I moved, but in the ended I 'ported' my old mortgage to my new property and just extended the amount I could borrow, as it was cheaper to do that (so option b for me).
Question 2: no, these are usually paid separately.
HTH
KiKi' <-- See that? It's called an apostrophe. It does not mean "hey, look out, here comes an S".0 -
(a)Existing home sale price - full redemption sum of mortgage - moving fees (inc. estate agent and legal) = proceeds of sale
(b) (New home agreed price + legal fees + SDLT) - mortgage offer amount = sum you need to put in
(c) Sum you need to put in - proceeds of sale = cash you need to send to your solicitor
Legal fees and SDLT are paid cash from a separate pot. Mortgage fees can be added to a mortgage, if you are able to borrow the sum that it comes to.
I would redeem the mortgage entirely if that close to a new deal and take out a new product.0 -
You want to make sure you don't sell your current home before the 31st of January 2018 as you may end up paying ERC,s0
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You want to make sure you don't sell your current home before the 31st of January 2018 as you may end up paying ERC,s
Some lenders will allow you to switch product / get a new mortgage without ERCs being applicable, if within x days of the mortgage fixed term ending. Check with your lender OP0 -
Thanks for the replies all. Made a typo and the current mortgage is actually Jan 2019 (not 2018) so I will have to check about early repayment charges etc.0
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goodwithsaving wrote: »(a)Existing home sale price - full redemption sum of mortgage - moving fees (inc. estate agent and legal) = proceeds of sale
(b) (New home agreed price + legal fees + SDLT) - mortgage offer amount = sum you need to put in
(c) Sum you need to put in - proceeds of sale = cash you need to send to your solicitor
Legal fees and SDLT are paid cash from a separate pot. Mortgage fees can be added to a mortgage, if you are able to borrow the sum that it comes to.
I would redeem the mortgage entirely if that close to a new deal and take out a new product.
Thank you for this, some silver lining that at least estate agent fees can go onto proceeds of sale!0 -
TobyLarone wrote: »Thank you for this, some silver lining that at least estate agent fees can go onto proceeds of sale!
It comes out of the pot on your sale - nothing has been added onto anywhere. Solicitors deduct it when the sale goes through as the agents send them the invoice on exchange.0 -
goodwithsaving wrote: »It comes out of the pot on your sale - nothing has been added onto anywhere. Solicitors deduct it when the sale goes through as the agents send them the invoice on exchange.
Ah OK, fair enough
I like your sig by the way0
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