Moving house and equity

Joeisaware539

Hi all, me and my partner both bought our first house 4 years ago at 27. A nice 3 bedroom semi detached. 

I would like to ask some questions: I am new to this website.

I would like some advice, our house is valued at £234,000 - our remaining mortgage is £125,000. 

We are looking to move to a new house in the region of £525,000 to £890,000 price region. 

We are using cash fo fulfil the new purchase, leaving our remaining mortgage active. 

How does it work moving “equity” from your house work? 

Joeisaware539

I forgot to say we paid just £178,000 for this house with a £30,000 deposit. £148,000

FaceHead

What you're describing sounds like you want to take your mortgage with you, and would then need to make up the gap between your current property's sale price and the new purchase price (plus fees etc) with cash. 

It's described here, known as 'porting': https://www.moneysavingexpert.com/mortgages/porting-your-mortgage/

It boils down to whether your current lender will accept the new house as security, rather than the current one. Pick up the phone and ask them if it's allowed and any fees. Even if you're in a fixed deal, porting might not be best, so use the ditch your fix calculator as per the link above to decide whether to port, or get a new deal. Does your current deal have an early repayment charge? If so it might be best waiting to move. If not it might be best to just get a new mortgage. 

SpiderLegs

Hi. You do not leave your old mortgage active.
You pay it off with the proceeds of your sale and apply for a new one on the new property.

The new mortgage may be for more, less or the same amount as the current one, depending on how you are financing the rest of the purchase.

Depending on how you arrange your new mortgage you may be able to transfer the interest rate across to your new one, 
or in other scenarios you may have to pay an early repayment charge.

have you discussed your plans with a broker/lender?

Joeisaware539

Hi guys, thanks for your reply’s I value each and everyone.

In my first post “I say we are using cash to fulfil the new house” I have been told we can port from TSB?

SpiderLegs

Joeisaware539 said:

Hi guys, thanks for your reply’s I value each and everyone.

In my first post “I say we are using cash to fulfil the new house” I have been told we can port from TSB?

Yes, the ‘port’ relates to your current deal being applied to the new mortgage.
the process is still the same - pay off the old mortgage, start a new one.

If you are staying with the same lender, not changing any terms from your current deal and still fit affordability then it should be a straightforward process. It might sound, appear and be marketed like you are simply ‘moving’ your mortgage but that isnt the reality.

MWT

Joeisaware539 said:

In my first post “I say we are using cash to fulfil the new house”

Given the price range for your new house that will be a considerable amount of 'cash' so do make sure you can document where the money has come from to the satisfaction of your solicitor.

I'm not suggesting there is an impropriety intended, but your solicitor will need to be able to confirm the source of funds in some detail.

Thrugelmir

To "move" the equity you'll need to either remortgage or sell the property. 

Joeisaware539

SpiderLegs said:

Joeisaware539 said:

Hi guys, thanks for your reply’s I value each and everyone.

In my first post “I say we are using cash to fulfil the new house” I have been told we can port from TSB?

Yes, the ‘port’ relates to your current deal being applied to the new mortgage.
the process is still the same - pay off the old mortgage, start a new one.

If you are staying with the same lender, not changing any terms from your current deal and still fit affordability then it should be a straightforward process. It might sound, appear and be marketed like you are simply ‘moving’ your mortgage but that isnt the reality.

Same lender, same terms: just moving to a bigger house with bigger square foot? 

Joeisaware539

Bump

Thrugelmir

Can you clarify what your question is?