Mortgage porting advice

DJG6991

My partner and I purchased our first home 2 years ago, as a small home we are looking to scale up but are curious about porting the mortgage to save exit fees. 

Current house purchased for £230k with a 60k deposit, 170k mortgage paid off 5k. 

This is a 5 year fixed term on an FTB mortgage at 1.8% and we have 3 years remaining. 

New property would be 300k. 

Is it possible to port a first time buyer mortgage and if so, what is the process for gaining the funds required for the remainder of the borrowing required? (Assume affordability checks on the full 300k cost are run?)

Also, are the “hidden” costs involved in porting that we’d need to be aware of such a valuation fees etc.

thanks in advance for any help!

dimbo61

When you bought your current home you put down a 25 % deposit.
You have paid off £5,000 so have £65/75,000 equity ???
Now your looking at a £300,000 property so 25% deposit would be £75,000+
Yes a new valuation fee may well be charged.
Your lender also needs to value the new place at £300K
Other costs such as buying and selling plus the stamp duty.
Affordability checks may now be tougher !
Good luck

eddddy

DJG6991 said:

Is it possible to port a first time buyer mortgage...

A lot of mortgages are portable - but not all. You'd need to check the terms of your specific mortgage.

kingstreet

It's worth remembering you are not porting a mortgage. You cannot transfer a mortgage from one property to another. Your existing mortgage is repaid from the sale proceeds of your current home.

You will apply for a new mortgage for the amount you need from your existing lender. The terms of your current mortgage will be transferred, or ported, to the new loan with any increased borrowing offered on one of the lender's current products of your choice based on the new loan to value.

As an example, if you sell for £230,000 your £165,000 mortgage is repaid leaving residual equity of £65,000. If you use all that as your next deposit, you will need a new mortgage for £300,000 - £65,000, or £235,000. The terms from your current £165,000 mortgage will be transferred and the new borrowing, £70,000 will be taken on a new product based on the 78% loan to value. You will be able to take the new mortgage over a new term so you won't have to take your new mortgage over (eg) 27 years if your first mortgage was over 30 unless you want to do so.

Fees and charges will be lender-dependent. Any decent broker will be able to obtain illustrations which show the costs involved including the monthly costs with the ported product.

The usual status and affordability checks will be carried out as they are for all new mortgages.

DJG6991

Thank you all for the advice, definitely cleared up a lot of confusion and answers I just couldn’t seem to find in clear enough detail online. 

Definitely feel more equipped for the next step now.