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The ins and outs of transferring a mortgage

Can I move the mortgage to a family member? Can I transfer my mortgage to my children? These are questions that are often asked when people think of transferring or moving their mortgage. For lenders, transferring a mortgage means to move your mortgage to a different property - also known as ‘porting a mortgage’. But you may also be thinking about transferring your mortgage to another person instead.

Why transfer your mortgage to another person?

Transferring mortgages between individuals can be complicated, and is not something you see often in the UK. However, if you’re considering adding or removing individuals on your mortgage, this is something that can be looked at.

There are many reasons for doing this. For example, you may want to:

  • Change from a single to joint mortgage
  • Move from a joint to single mortgage
  • Remove a borrower

These things should not increase the borrowed amount, but be aware that you may have to pay a fee for the transfer.

How transferring your equity to others works

When looking to transfer your mortgage, whether adding or removing someone, it is best to speak to your lender as the process may vary.

The process is often called ‘Transfer of Equity’, but may have various names, and will keep your house ownership the same, but will change the details of the borrowers on the property ownership. The Transfer of Equity process will be different depending on the individuals and their circumstances.

Transferring a mortgage to family or relatives

If you’re looking to move your entire mortgage to someone else, this is a different process from transferring equity and will take you off the ownership of the property.

Transferring your mortgage and property to a family member or relative while removing yourself from the mortgage, would typically take place as a sale or purchase. For example, if you and your partner wanted to transfer your mortgage and house to your children while removing yourself from the mortgage, this a separate process that would be completed with the support of your lender and solicitor.

Transferring your mortgage to your children, transferring your mortgage to a relative and transferring your mortgage to a parent all fall under this category. There are other exceptions, however.

Transferring solely your share of the mortgage

If you decide to transfer your share of the mortgage and property to a family member or relative while keeping the existing names on the mortgage, this will be a transfer of equity.

For example:

1. Mum and Dad are both on the mortgage for their property but want to include their children.
2. Dad moves his share of the mortgage to his children and removes himself from it.

This is considered a Transfer of Equity. Things such as, adding your children to your mortgage, transferring your mortgage from single to joint, or transferring to sole name would also all fall under this category.

The next step for a Transfer of Equity is to speak to one of our mortgage advisers to get a better understanding of what your needs are and how we can meet them.

 

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.

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