Would a house move within five years (even six months!) stop you from fixing for five years?

w00519772

My fixed rate recently expired and I am now on the SVR paying an extra £150 PCM in interest payments. I am planning to move to a fixed rate within the next week. I am planning to fix for five years.

I have chosen five years because my LTV is below 60% (best bracket I believe) and I believe interest rates will go up over the next five years.

The only concern I have is that this will tie me down for five years. The bank tell me that the mortgage is portable and I have the option of consent to let if I move within five years e.g. because of a job offer. The mortgage is with First Direct.

Would a house move within five years (even six months!) stop you from fixing for five years? Also I would be interested to hear from anyone that has ported or used consent to let and how easy/difficult this was.

AnotherJoe

The bank tell me that the mortgage is portable and I have the option of consent to let if I move within five years e.g. because of a job offer.

Do you believe the bank is lying?
Would this potential job offer be abroad or somewhere you wouldnt buy a house? Otherwise why would you let it out ?

Paying extra money each month for a rate rise thats unlikely to happen fast enough and to a high enough level within that time that would make it beneficial, would stop me fixing for 5 years
I'd rather spend the difference on pension or overpayments.

w00519772

AnotherJoe wrote: »

Do you believe the bank is lying?
Would this potential job offer be abroad or somewhere you wouldnt buy a house? Otherwise why would you let it out ?

Paying extra money each month for a rate rise thats unlikely to happen fast enough and to a high enough level within that time that would make it beneficial, would stop me fixing for 5 years
I'd rather spend the difference on pension or overpayments.

No, I don't believe the bank is lying. I just wander how difficult it is to port i.e. is there a lot of red tape and conditions that I am unaware of?

The standard variable rate would cost me an extra £150 PCM.

phillw

w00519772 wrote: »

No, I don't believe the bank is lying. I just wander how difficult it is to port i.e. is there a lot of red tape and conditions that I am unaware of?

You should ask them that and get them to put it in writing.

w00519772 wrote: »

The standard variable rate would cost me an extra £150 PCM.

Right, don't stay on SVR. I think what he meant is that lenders will charge you a premium for a 5 year fix & he would take the gamble for a shorter fix. I took the same gamble & took out my first fix for two years. Although rates had risen in those two years, I took out a tracker and rode them down again. I was lucky and it saved me a fortune.

AnotherJoe

w00519772 wrote: »

No, I don't believe the bank is lying. I just wonder how difficult it is to port i.e. is there a lot of red tape and conditions that I am unaware of?

The standard variable rate would cost me an extra £150 PCM.

You wont be unaware if you read the TS&Cs.


As phillw said I meant the extra you'd pay for a five year fix as opposed to, say a 3 year.

ACG

Whilst the mortgage may be portable, it does not mean you will be eligible to port when the time comes.

If you plan on moving within 6 months, I would check if you fit criteria and pass affordability for the amount you expect to need in 6 months. If it is tight, I would hold fire if it flies through then I would probably get on with it.

If you are planning on moving in 3 years, then I would not tie in to a 5 year fixed rate. 6 months down the line, you probably know what will happen, in 3 years anything could happen.

I would take the savings on a 2 year over a 5 year rate now and suck it up down the line, you can always overpay the extra few quid each month so the higher rate in 2-3 years is on a smaller balance.

FIRSTTIMER

I think to be fair First Direct are very strict, so its like you are a new customer when you want to port.
I think rate porting seems to be ok for the people who have not got on the property ladder and then had 2.4 children and decide they want a bigger house with one income and loads of outgoings, that's where the problems kick in, regardless of equity etc.