How can we raise more money to move into a bigger house?

Posted on 2 May 2008

We have our house on the market and are looking to move into a bigger house which of course will costs us more money. What do we need to do in terms of our mortgage. We are with Alliance & Leicester and our current deal runs out in November this year. Do I contact A&L and ask for more money?

Hi Kellie,

Don't worry, that's what we're here for!  If you plan to move in November, you should be free to pay off the old mortgage when you sell the old house, without penalty, assuming the Early Repayment Charges (ERC's) on your Alliance and Leicester deal only extend as long as the fixed/ tracker/ discount rate you've got. The profit you have from the sale is the deposit on the new one.  You can simply take aout a new mortgage on the new house based on that deposit size.

If, however, you need to move before the ERCs on your Alliance and Leicester mortgage have expired, you can ask A&L to let you 'port' the mortgage to your new house, borrow a bit more if you need to. In November, having already moved, you would simply find a new deal (probably with a new lender) when your deal runs out in November. This will be a normal remortgage.

One thing you do have to be careful of though, is if you take some extra mortgage from Alliance and Leicester, make sure you take a mortgage deal with no penalties (ERCs). The last thing you ant in November is to try to remortgage to a better rate, only to be told that you have penalties for two years on that little bit extra you took when you moved.

Best of luck.

Katie

Category: The application process explained

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