Portable mortgages - what's the caper?

marcdbl

Ok, so my first post, and it's a bit of a drawn out one......

I am currently looking to remortgage as my fixed term has come to end, and there is no outstanding penalties.

I'd like to get another 2-year fixed-rate product, however I am expecting to be looking at moving home (and hence increasing my borrowing) in 6 months or so.

So, a portable mortgage seems to be the answer, however, can anyone answer any of the following questions...

1
When I port the mortgage, will the lender let me borrow the extra at the original rate?

2
Or will I have to take an additional mortgage from the lender to cover the additional borrowing at whatever the new rate is?

3
In which case can I shop around and borrow the additional from a different lender?

4
If I can go to a different lender for the 'top-up', are lenders generally just as happy to lend a 'top-up' amount as they would be a full amount?

Thanks Money Savers!

marc

herbiesjp

In answer to your points:

1) No
2) Yes
3) No
4) Not applicable

payless

1. not usually
2. Often a new rate is on offer for the top up- but often fees apply
3. Second charge- usually more expensive and hard to agree on a purchase, so struck with existing lender ( or poss unsecured ?)
4.n/a

payless

There are some fixed rates without penalty, but costs are higher
given the short time before moving is it worth remtg in meantime ? - with costs ( even on a fees assisted deal you would usually pay old lender a fee)
Have you asked if existing lender will offer a (low/ no fee) swap to a rate ( possibly without a tie)
Do you really want to fix now rather than wait - which might be easier
( if fixing is so important - why only 2 yrs?)

marcdbl

Thanks for the answers and some very interesting points.

I'm just ending a fixed rate of 4.09 and facing my current lenders SVR of 5.99. So with your replies in mind maybe a fixed term mortgage (with all its penalties) isn't such a great idea, but I really don't like the look of a 5.99 rate for the next few months.

Perhaps a discount/tracker would suit my needs better if I can get out with a minimal penalty in ~6 months time?

The fact is that if I do move in 6 months my new mortgage will be mahoosive so by then I'll have to go for a fixed to be sure I can cope with it for a couple of years. In the meantime I can cope with a slightly higher (and possibly fluctuating) rate if it means avoiding unreasonable charges down the road.

payless

Obviously will depend on amounts currently owed, new likely mortgage, and likely time before swap
Need a good number crunching to see if worth moving

holly876dog

Perhaps look at Egg, they currently offer 4.24% 6mnths/flexible options. V low set up costs (think its £25). Would have to look into exit costs though. This might be they way to tide you over for a short while?