To port or not to port

mashmash90

We are about to complete on selling our property. We have a 0.75% ERC that we will be paying due to it falling within our fixed term which ends in November 2023. We didn't wish to wait due to it being a shared ownership property so it was a lengthy and complex process to sell.

We originally were buying and selling simultaneously and had a full mortgage offer accepted with nationwide to port our mortgage and borrow extra. We since pulled out of the house purchase and decided to just sell and find somewhere else. We have since had an offer accepted on another property. 

The new property will be in a chain, length not certain yet as it's not complete. So we are taking the time to ponder whether we split port and go back to nationwide. Saying that, it will be a very temporary solution, given the majority share of the 'ported' deal comes to an end in November (the rate is 1.09% until then). The rest would be on a tracker, which was set at something like 4.45%

Pros of porting: get our ERC refunded (about 1.8K), lower interest rate for a few months (if we do complete in the next few months that is). Ease of getting a mortgage with them in the past.
Cons: still have to pay £999 product fee for the additional borrowing product, and what will essentially be our mortgage for only a few months. Admin burden of having to remortgage in November. Potentially another product fee come November?

We like Nationwide but I'm wondering if porting a mortgage for what could be 2-3 months and then having to find another deal might be counterintuitive. Would trying to find a new deal and fixing straight away be better? Are there many lenders that don't charge a £999 type product fee that could offset that cost?

Typhoon2000

You don’t have to pay £999 product fee if you don’t want to. Nationwide always gives rates without a product fee if you prefer. See which works better for you. You could do a product switch when your fix comes to an end in November rather than than remortgage elsewhere ( Nationwide normally have pretty good rates and they guarantee it will be as good as for new customers).

kingstreet

Port with an ERC-free and fee-free tracker for the increased borrowing; then you can look at a whole new product when the ported product ends. That way you won't end up trapped with two product expiry dates.

K_S

@mashmash90 As mentioned above, Nationwide should have a fee-free version of the tracker, though the rates on those start from 5.7% or so.