This is not to be mistaken with ‘Remortgaging’ and here’s why it’s important you speak to a qualified financial adviser to keep your mortgage rate while moving house and avoid penalty!
First things first, what does porting mean and how exactly you can keep your mortgage rate while moving house and avoid penalty?
Porting simply means moving your current mortgage across to another property whilst you are locked into a fixed rate, this will help you avoid the early repayment charges applied by your bank.
Is it always possible to port a mortgage?
No it isn’t. The fact you have a mortgage on your current property doesn’t automatically mean you can move this to your new home, unfortunately.
The first thing to do is to check your original mortgage offer. This will tell you if your interest rate is portable or not because not all of them are. Should you not have your original mortgage offer, don’t worry! You can always contact your lender and ask them.
Once you have confirmation your rate is portable, you can proceed to the next steps.
Porting requires a new application to your lender and this means passing all the necessary checks. The checks you should expect are affordability and credit score checks, even if you are not requesting any additional funds. Once you have passed these you can then consider yourself able to proceed with a porting application. This is the point where your lender will instruct a valuation on the property you’re looking to purchase to make sure it can be considered suitable security.
What are your options if Porting is not viable?
There are situations when your own lender might not be able to offer you the same funds to cover your current mortgage. The result here is that they won’t approve a new application to port your mortgage over to the new property. This doesn’t mean you won’t be able to move but you will just need to proceed with the best lender for your circumstances. Be aware that This will come at the cost of an early repayment charge.
It is important you are aware of this sooner rather than later. The last thing we want for you is a very unpleasant surprise. Discovering this only after you’ve had an offer accepted on your dream property is devastating. This is exactly how you keep your mortgage rate while moving house and avoid penalty.
Should you be looking to purchase a new property and are locked into a fixed rate, feel free to contact us to explore your options.
For further information about Porting a mortgage, check out this comprehensive guide from The Advisory