Porting your mortgage

Should you wish to move house before your current mortgage product ends, you may be able to transfer your current mortgage product to your new home, this is called ‘porting’.

If you’re part way through a mortgage product which carries early repayment charges (ERC’s), you could avoid having to pay, or be refunded, these when you move.  The early repayment charge may be waived if you complete your new mortgage on the same day as you repay (redeem) your current mortgage.  Where this does not happen, the early repayment charge may be payable on redemption of your current mortgage, but refunded provided that your new mortgage completes within 6 months of redemption.

It's important to note that it’s the product/rate that is ‘portable’, not the loan amount. You’ll need to reapply for a mortgage on your new property.  Your application must meet our lending criteria at the time of your new application and changes in circumstances could affect your eligibility. We can’t guarantee to offer you a new mortgage if your personal circumstances or our lending criteria have changed.  An early repayment charge will be payable if we’re unable to port some or all your mortgage product to your new property.

When you buy a new home, the likelihood of it costing the same as the house you’re selling is low. You’re either going to want to:

• borrow more money (or find it from elsewhere) or,
• reduce your mortgage amount.

Borrowing more

If you’re moving to a more expensive property you may need to borrow more money.  How much extra you borrow will depend on the amount of equity you have in your current property.  The equity is the difference between the price you sell it for and the amount you owe. You may also put some money towards the new home. The amount left over will be the amount you’ll need to borrow on your new mortgage.
 

Borrowing less

If you move your mortgage product to a cheaper property, you’ll still need to meet the same product terms to enable you to port it. For example, your new loan-to-value must not exceed your current one. This means you would be unlikely to be able to take the full amount of your mortgage with you when you move. If you do borrow less on the product than the amount you owe on your current mortgage, early repayment charges may apply on the amount not being ported.

 

Things to remember before you decide to port your mortgage

• Check your original mortgage offer to make sure the product you have is ‘portable’, its maximum loan to value and any applicable early repayment charges.
• The amount you port must not exceed the maximum loan to value of the product based on the valuation of your new home.
• Think about any changes in your circumstances – you will have to reapply for the mortgage and may no longer be eligible.
• In certain circumstances when porting your mortgage product, you may need to pay an early repayment charge.

To find out more about porting your mortgage, give us a call on 0808 169 6680.