Mortgage porting query

newbridge

I am thinking of buying a new residential house. Current mortgage is still on fixed term. 

Might be simple questions, but don't know how it works so would appreciate your expert views.

- I believe the ported mortgage + new borrowing runs only until the fixed term of original mortgage (correct me if wrong)

- When you port the mortgage, what happens to the old house. Who takes over that until its sold? or until I arrange another new mortgage on it?

Thrugelmir

Porting is a term that simply applies to the transfer of the existing mortgage product to the new property. Additional borrowing can be taken out that has a different term to that of the original. 

You would either need to sell the property or arrange a new mortgage if you were to port. 

[Deleted User]

are you selling your current property?  

amnblog

Do not confuse the mortgage (lending) with the mortgage product.
As stated above, it is the mortgage product (e.g. 5 year fixed rate) you may have the option to 'port' - not the mortgage lending.

This feature is designed to avoid you having to pay an early redemption penalty on your mortgage product when you clear your original mortgage lending. You can 'port' your mortgage product instead, and take it with you to apply to your new mortgage lending on your new property. Any top up lending will be on a new rate and the mortgage term can be adjusted within criteria limits on the new lending to suit your needs.

In order to port your mortgage product from the original mortgage lending, you need to clear that original lending by either, sale, or remortgage of the original property.

Some lenders will want you to clear the original lending on the same day you take the new lending in order to use the porting facility. Others have a window (typically 6 months), from clearance of the initial lending until take up of the new lending, during which you can still port.
If you do not clear the original lending and take up new lending on the same day, you will need to pay any early redemption penalty and then claim it back when you later 'port' the product.

newbridge

Deleted_User said:

are you selling your current property?  

No, because it might take few months to complete. While my new purchase is ready which is at a good purchase price and sellers are not willing to wait . Which means i will have to let for some time until i find a buyer for current home.

newbridge

amnblog said:

Do not confuse the mortgage (lending) with the mortgage product.
As stated above, it is the mortgage product (e.g. 5 year fixed rate) you may have the option to 'port' - not the mortgage lending.

This feature is designed to avoid you having to pay an early redemption penalty on your mortgage product when you clear your original mortgage lending. You can 'port' your mortgage product instead, and take it with you to apply to your new mortgage lending on your new property. Any top up lending will be on a new rate and the mortgage term can be adjusted within criteria limits on the new lending to suit your needs.
So can the additional lending also end at the same time as original one (eg six months) ? since I think it would be difficult to find new lender to lend part mortgage which would again be out of sync with remaining part.

In order to port your mortgage product from the original mortgage lending, you need to clear that original lending by either, sale, or remortgage of the original property.
I understand the key part now, that original lending has to be cleared, before any kind of porting happens

Some lenders will want you to clear the original lending on the same day you take the new lending in order to use the porting facility. Others have a window (typically 6 months), from clearance of the initial lending until take up of the new lending, during which you can still port.
If you do not clear the original lending and take up new lending on the same day, you will need to pay any early redemption penalty and then claim it back when you later 'port' the product.
Do I have to pay the interest rate, for the time between clearing original lending and porting later (within 6 months)?

Thank you for your detailed reply. This makes much more sense to me now!
some more questions inline above