Porting fixed-term mortgage with YBS

stevetuk

I am selling my home and have had an offer accepted on another property. I actually don't need as big of a mortgage for it, but my lender (YBS) has insisted that their underwriter has said I must borrow exactly the same: no more, no less, because I had 4 missed payments on my credit card last year. I can't even borrow less?! 

I am currently on a 5-year fixed-term mortgage which ends in 2027 on 3.65%.

That said, they have approved the mortgage port in principle, and are now making me speak with a Mortgage Advisor to go through my options.

Options?

I thought I would just be porting my exact mortgage arrangement across to the new property. Are they going to end that mortgage and make me re-apply for a new (less preferential) one with different rates etc? Surely if I am borrowing the exact same amount, there is no need to do anything other than move the mortgage across to the new property? I am worried they are manipulating me into a worse deal.

kingstreet

You can't transfer a mortgage from one property to another. That's not how porting works.

With your lender's agreement, you can apply for a new mortgage and have the terms of the old one transferred to it at completion.

I suspect the bulk of your appointment will be to discuss your "protection needs" after about ten minutes where you're given an illustration for the new mortgage equivalent of your current loan.

ian1246

I did a port with YBS - its a new mortgage, just identical conditions (including the remaining "fixed term" date on your current product).

If you don't need the full mortgage but they insist, just go with it & bank the extra equity (which you would have put into the property for a smaller mortgage). At 3.65% on your fixed deal you can get significantly higher saving rates for any left over cash - meaning the interest from savings will offset any interest on the extra unwanted mortgage.

You also can overpay your mortgage balance with no Early Repayment Charges by 10% every 12months, including the very next day after you complete on your mortgage....

Or depending on your age, stick it into your pension to get a 25% (40% if higher rate tax payer) top up which you can then use to pay back the remaining mortgage balance when you retire...