Additional borrowing for a house move

littleteapot

My wife and I are planning to sell our current 2 bedroom house which I have owned for over 11 years and move to a 3 bedroom house in the same area.

I've checked with my existing mortgage provider (HSBC) and the current mortgage is portable. This is good news as that is fixed at 2.6% until 2029.

Am I right in thinking that it is preferable to use HSBC for the additional borrowing to cover the difference in sale price of our current house and the purchase of the new house?

I've heard of second-charge mortgages but my casual reading seems to suggest that not many lenders offer these and the interest rates tend to be higher than securing additional borrowing from the existing lender. Is my assumption correct?

Thanks in advance!

CSI_Yorkshire

I think your assumptions are safe and you have the right idea.

kingstreet

You will apply for a new mortgage with HSBC for the full amount you need to borrow. The first part equal to your current borrowing will be offered on your current or ported product. The increase will be offered on a new product reflecting the total LTV at today's rates.

Remember, you are porting the old product terms to a new mortgage; you aren't porting the old mortgage to a new property as that isn't possible

littleteapot

That makes sense now, thanks for the clarification .