Moving home can be both exciting and daunting, particularly when it comes to the financial side of things. One of the main aspects of moving homes that can be daunting to some is taking out a new mortgage, but taking out this mortgage can often be very beneficial. In this article, we will discuss what this mortgage option is, how it differs from other types of mortgages, and what you need to consider when getting one and deciding whether it is the right option for you.
Key Takeaway
The mortgage market is extensive, and there are many lenders offering a variety of deals. It's important to compare rates, fees, and features to find the right option for your circumstances. Understanding your financial situation and future plans can help you determine which mortgage is right for you. Additionally, it's essential to consider all the additional expenses that come with home buying, such as insurance, taxes, and closing costs. By doing your research and making informed decisions, you can ensure that your home-buying process is a smooth and successful one that won't hurt you in the long run.
What does this mean?
A home mover mortgage, also known as a "moving home" mortgage or a "porting" mortgage, is a type of mortgage that is designed for people who are wanting to move to a new home. It enables you to take out a new mortgage on a new property while paying off your existing mortgage at the same time. This is different from other types of mortgages, such as first-time buyer mortgages or buy-to-let mortgages, as it is specifically tailored to people who already own a home and are looking to move.
Who is eligible for a home mover mortgage?
Anyone who currently owns a home and is looking to move to a new property is eligible for this type of mortgage. However, eligibility depends on a number of factors, such as your credit rating, income, and whether you can afford the new mortgage repayments.
What are the benefits of a home mover mortgage?
One of the main benefits is that it can allow you to keep your existing monthly payment, while still being able to move to a new home. This means that you don't have to pay off your mortgage in full before moving, which can be a real advantage for those who want to move houses quickly. Additionally, it can allow you to take advantage of lower interest rates on your mortgage, which can help you to save money in the long run.
Should I get mortgage broker help?
If you are looking to get one of these mortgages, then you may want to consider using a mortgage broker. A mortgage broker can help you to find the best mortgage deal for your needs, as they have access to a wide range of lenders and mortgage products. They can also help you with the mortgage application process, providing guidance and support along the way.
What do I need to consider when getting a new mortgage?
First, you need to think about how much you can afford to borrow and how much you can afford to repay each month. You also need to think about the term of the mortgage, whether you want a fixed or variable mortgage rate, and any fees or charges associated with the mortgage.
How does equity in my home affect my ability to get a new mortgage?
Your equity in your home can affect your ability to get a new mortgage, as it determines how much of a deposit you can put down on the new property. If you have a large amount of equity in your current home, then you may have more flexibility. However, if you have little or no equity in your home, then you may need to consider other options, such as taking out an additional mortgage.
What happens to my current mortgage when I move home?
When you move home, your current mortgage does not automatically end. Instead, you will need to take out a new mortgage on your new property. This means that you will need to go through the mortgage application process again, and your current mortgage will need to be paid off. However, it is possible to increase the value of your mortgage when you move, if you need to borrow more money to buy a bigger home, for example.
Can I port my mortgage to a new property?
If you have a portable mortgage, you may be able to transfer or "port your mortgage" to a new property when you move. This can be a good option if you want to increase the mortgage value and avoid paying early repayment charges. However, not all mortgages are portable, so you will need to check with your lender to see if this is an option for you.
What happens if I have early repayment charges on my existing mortgage?
If you have early repayment charges on your existing mortgage, you may need to consider whether it is worth paying these charges in order to move to a new property. Alternatively, you could wait until the charges expire before making your move, or consider taking out a new mortgage that allows you to pay off your existing mortgage without incurring any charges.
What are my options if I am looking to move?
As we have mentioned above, these mortgages allow you to move your mortgage over to your new home. There are many options for homeowners looking to move where you won't have to change your original mortgage. Ultimately, you will want to contact your mortgage adviser to see whether this mortgage can help you in the long run. Let's take a look at a few things to consider when planning to move.
What if I want to repay my current mortgage before moving?
If you want to repay your current mortgage before moving, then you will need to pay off the outstanding amount on your mortgage in full. You may also need to pay any early repayment charges that apply, depending on the terms of your mortgage.
Should I consider remortgaging before I move?
Remortgaging before you move can be a good option if you want to take advantage of lower interest rates or if you want to raise funds for home improvements. However, you should only remortgage if it makes financial sense to do so, and if the costs associated with remortgaging are outweighed by the benefits. Unless you’re moving to downsize your home to one of considerably lower value, it’s unlikely that you’ll benefit from choosing to remortgage and should consider porting your current mortgage, where possible.
How do I find the right mortgage provider for my new home?
To find the right mortgage provider for your new home, you should do your research and shop around for the best deal. You can use a mortgage broker to help you with this process, or you can do it yourself by comparing mortgage products online. Remember to check the terms and conditions of the mortgage carefully before committing to anything.
Is my home at risk of repossession if I can't meet the repayments on my mortgage?
If you are unable to pay an early repayment charge or meet the repayments on your mortgage, then it is possible your home may be repossessed. It is therefore important to ensure that you can afford the mortgage repayments before taking out a home mover mortgage. You should also consider the impact that any changes in your financial situation could have on your ability to meet the mortgage repayments.
Who regulates home mover mortgages?
They are regulated by the Financial Conduct Authority (FCA), which is an independent regulatory body that oversees the financial services industry in the UK. The FCA sets rules and standards for mortgage lenders and ensures that they treat customers fairly and transparently.
What are my options if I can't pay off my existing mortgage?
If you are struggling to pay off your existing mortgage, then you should get in touch with your lender as soon as possible. They may be able to offer you a repayment plan or another form of financial assistance.
The Bottom Line
Furthermore, for those looking to move and want to port their mortgage, it is crucial to understand the terms and conditions first. By understanding the implications of these decisions, you can make the best-informed choices that align with your long-term financial goals.