New mortgage

tjw77

I'm thinking of selling my property and buying somewhere else but since I've been with my lender I've started a debt management plan with CCCS and am worried that I will now be denied a mortgage by them if I apply. I'm not sure of the process anyway - if I were to port my mortgage for the same amount would I still have to go through a new application? But its more likely that I would need to borrow a bit more - an extra £5k. I am worried about the consequences if I broach the issue with my lender and try to establish whether I would be able to get a new mortgage with them - I don't know if they can then take any action, even though I have never missed a mortgage payment with them. Does anyone have any knowledge or advice to offer on this?

Thanks

superged

Your exisitng lender may well port what you have outstanding if your mortgage is portable (not all are) although unless you already have a specialist lender the chances of getting another 5k out of them are remote.

Porting you will have to submit a new application but submitting but instead of selecting a new product you just mark it as a ported deal.

Leon_W

It'll depend on a lot of things such as the Loan to Value, your income etc etc but it is a common thing for people to think that "porting" a mortgage is a simple case of moving it from one property to another. It's not.

Such cases are completely underwritten again and you have to meet the lenders criteria at the time of application. I'll give an example. Say you were currently living in a house with a 95% mortgage but wanted to "port" this to a new build flat that you had seen, again at 95%. The chances of doing this would be practically zero as most lenders have changed their criteria limiting flats to 80% or lower.

Say your income had gone down. Again some lenders have lowered the amount they are prepared to lend on a given salary. I have also seen cases where, such as yourself, debt management plans, IVAs, CCJs have all thrown a spanner in the works and the lender has refused to port the mortgage because you do not meet their current criteria.

There are no hard and fast rules and the only concrete answer your going to get is from your exisiting lender so I feel you have no other option than to ask them and take it from there.

Regards

tjw77

Ok, thanks. My loan to value for the new property taking into account the extra borrowing would be approx 62%, and my income has increased (albeit slightly) but I think that all the lender will look at is the debt management plan. I just don't want to jeopardise the mortgage I already have with them by asking

Leon_W

You won't jeopardise the mortgage you already have as that's in the past as far as the lender is concerned . They cannot change your present mortgage contract unless you break the terms of it which you haven't.

What you are asking for is a new mortgage contract which (if they are so minded) can refuse. Your Loan to Value does help though.

To re-iterate. Asking your lender will result in a yes or no answer on the porting but has no affect on your present arrangement.

Regards