Porting Your Mortgage

Posted on 5 May 2011 by gordon

I currently have a 2 year fixed mortgage (ending December 2011).  I am porting my mortgage (55k) from my existing lender to a new property (loan to value=18%). Completion on new home due 27th May 2011. They are currently approving the transfer (which has taken almost 2 months!). 

If they come back and refuse my transfer - what happens to my existing mortgage (let alone the penalty payments I will incurr with the builders if I do not complete on the deadline)?


Unless you have not being paying your mortgage when it falls due I would be very surprised if your Lender declines your request.  However, you should check your original mortgage offer and the terms and conditions to make sure that it is portable.

What happens to your existing mortgage depends on whether you are selling, letting or continuing to live in your current home.  If you are selling then the mortgage will have to be repaid and it is highly likely you will have to pay an early redemption charge (ERC) in addition to the outstanding debt and interest charges.  The details of this will also be in your existing mortgage offer.  If you are going to let the property then your lender may let you stay on the existing mortgage deal and just grant their consent to let, they may load your current interest rate or they may not give their permission to let in which case you would need to look at a remortgage and the ERCs would become payable.  If you are intending to continue living in the property then there will be no change to the mortgage.

I recommend that you speak to your lender and point out the deadline you are working to.  Ask if it would speed things up if you got your Solicitor to confirm in writing when completion of the purchase is due to take place, sometimes this can help move things up the pile if there is a backlog.


Answers provided in response to Ask the experts are based on the information provided and do not constitute advice under the Financial Services & Markets Act. They reflect the personal views of the authors and do not necessarily represent the views, positions, strategies or opinions of John Charcol. All comments are made in good faith, and John Charcol will not accept liability for them.

We recommend you seek professional advice with regard to any of these topics where appropriate.

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