Selling, buying and new mortgage!!!

flinni

Hello people,

I wanted some impartial advice on what people would do in my situation.. so to start with, here is how it stands;

I currently own my own home with about £10-£15k's worth of equity in it and am potentially looking to put this house on the market in the next two weeks. The idea is sell my current property (and using this equity) buy somewhere with my long term girlfriend who currently lives with me, but isn't currently on the property ladder. We have a deposit of £20k (and a separate pot for stamp duty, legal fees, moving costs etc) and are looking at buying somewhere for between £180-200k, therefore we have a circa 10% deposit

The first question is (and it’s a difficult one), is it a good time to sell and upgrade? I'm getting a little nervous with all the talk about a possible impending crash, and as we don't have a great deal of equity (10%), any substantial fall over the next year or two would effectively wipe out our deposit and put us into negative equity!! Is it worth riding the storm out over the next 6-12 months or taking the plunge now?

In addition to this (and to complicate matters), my current tracker mortgage with Northern Rock (don't laugh) comes to an end on 30th April. My current rate is about 4.69% and this will rise to about 7.59% on their standard variable rate. I'm free to switch to any deal without penalties from 1st May.

Question - if I change my mortgage now to a better rate, will I have to change it again if I move this year and take out a new mortgage, and is this likely to incur a penalty charge? I've heard about portable mortgages, would this be appropriate in these circumstances? Would it be best just to take a hit for several months and pay the 7.59% standard rate with Northern Rock, but have the flexibility to switch later in the year? I've noticed that the arrangement costs of new/re-mortgages have gone through the roof; therefore I don't really want to have to pay twice. Any help would be greatly appreciated?

Thanks

Iain