Porting your mortgage: transferring explained
When thinking about moving home, one of the first things you may start to consider is your mortgage situation. You might start by looking into a new mortgage for the property you’re moving to. However, if you’d like to keep your current mortgage deal, you can – this is referred to as transferring or porting a mortgage.
How does porting a mortgage work?
Porting a mortgage is a fairly straightforward process. Speak to your lender about your intention to move home, and they will then re-assess your circumstances to make sure you still qualify for this deal. For example, if you're three or four years into your 35-year deal, then your circumstances may well have changed from when you originally applied for your mortgage.
Providing you're successful, once the reassessment is complete you can then ‘port’ this mortgage offer to purchase the new property. In reality, you undergo the same
process you would if you were purchasing a home with a new mortgage offer.
How do I know if I can port my mortgage?
Most mortgages are portable and this flexibility is often baked into the mortgage deal you have agreed with your lender. However, as some deals and lenders do not include the ability to port your mortgage, it’s worth speaking to your lender to find out.
Typically, you will know if you're able to port your mortgage if you can confirm the following:
• Your mortgage deal explicitly states you have the option to do so
• Your lender confirms you are able to port your mortgage
• Any introductory offer period (such as a two-year fixed rate) has finished
If, however, you are not able to port your mortgage, then you may need to look at other options.
If I can’t port my mortgage can I switch?
Yes, you always have the right to switch to a new loan. However, if you do decide to switch, you may need to pay various fees to leave your mortgage provider early.
Speak to your mortgage lender to understand your current situation first, and then contact a mortgage adviser about your available options. You may even find you can
get more value for your money by not porting your mortgage.
What fees can I expect to pay for porting my mortgage?
Looking to downsize or buy in a cheaper area where your existing mortgage covers the amount you need to borrow for your new property? Depending on your lender,
you may only have to pay certain fees, such as a valuation survey fee, when porting your mortgage. You may even find you can renegotiate the house price after a
survey! But additional circumstances may mean you need to pay extra fees.
Can you port a mortgage and borrow more?
If you need to borrow more money to pay for your new house, you may still be able to port your mortgage. Just bear in mind that you will probably have to pay a fee to
increase your mortgage loan. You may need to pay an exit fee too if you want to leave your current mortgage.
Can you port a fixed rate mortgage?
Should you choose to leave before your introductory offer period ends – such as a two-year fixed rate – then you'll also have to pay an early repayment charge on top
of any other fees to leave. This tends to be between 1% to 5% of the remaining debt for your mortgage, meaning it may not be worthwhile so early in your mortgage term.
Can you port a mortgage with Help to Buy?
For those who used a Help to Buy loan to purchase their property, porting a mortgage can be tricky. As you'll need to pay off your Help to Buy equity loan when you sell your home – equivalent to 20% of the value of your home when you purchased it – this will add a large cost to porting your mortgage. This is in addition to any other fees you might need to pay.
So should you port your mortgage?
For those downsizing or moving to a cheaper area, porting a mortgage is a very attractive option. It allows you to stay on a deal you're comfortable with, with relatively little hassle, and little to no fees. If things aren’t quite as straightforward, however, then it’s worth weighing up your options and seeking mortgage advice to find a mortgage that’s right for you.
Because we play by the book we want to tell you that…
Your home may be repossessed if you do not keep up repayments on your mortgage.
There may be a fee for mortgage advice. The actual amount you pay will depend upon your circumstances.
The fee is up to 1% but a typical fee is 0.3% of the amount borrowed.