Moving home: a step-by-step guide
The fact you’re moving home doesn’t mean you have to change your mortgage, though it might be a good opportunity to do so. Most mortgages nowadays are portable – that is, you can take them with you from one property to another, subject to some checks by the lender. The process is usually quite simple: you can break it down into a number of key steps.
1. Talk to your current mortgage lender
Start by talking to your current mortgage lender – it is worth getting to grips with your options even before you’ve identified the property you hope to move to. You’ll need to check what transferring the mortgage will cost – a charge of a few hundred pounds is quite typical.
2. Assess your borrowing needs
As you start looking for a new home, think about whether you’ll need to borrow additional sums to secure the type of property you’re after. If so, you’ll need guidance on how much lenders are prepared to advance. Your application for additional finance will be subject to affordability checks looking, looking at what you can afford to borrow based on your current circumstances. You can apply for more funding from your existing lender, or a new provider if you’re considering remortgaging.
3. Look at remortgaging
While you can transfer your mortgage, you don’t have to. The house move might be a good opportunity to review your current mortgage arrangements and to look at whether remortgaging makes sense.
Remortgaging may be a good idea whether or not you need to borrow more. But don’t just look at the headline rates of interest offered by rival mortgage lenders. You need to understand what the total cost of the monthly repayments over the term of the new deal will be compared to the total cost of the monthly repayments on your current mortgage. Don’t forget to add in all the charges you’ll incur – such as any exit penalties you might pay from your current arrangement and arrangement fees for the new deal.
4. Complete the application process
While the application process for the additional finance will be similar to what happened when you took out your first mortgage, you don’t have to go for the same type of loan. If your existing deal is a tracker mortgage, for example, but you want to fix the rate on the new borrowing, that’s fine.
If you’re remortgaging as you move home, the new lender will also want to value the property you’re buying and to see a survey of the property. You’ll go through a credit scoring process and be asked to provide evidence of your income, as well as other basic documentation.
Take independent advice
In practice, while transferring your mortgage when moving house should be straightforward, it makes sense to take expert advice on whether this is your best option. If not, an adviser can also help you identify the best alternative products – and to arrange additional borrowing if needs be.
Our expert mortgage advisers will search thousands of mortgage deals made available to us and pick out the one that’s right for your circumstances.