October 2023
October 2023
Guide to porting a mortgage: mortgage porting explained
Want to move but tied into a fixed rate? Matt Halder of Threshold Mortgages explains how to port your current mortgage to a new home, and when it might be in your best interests to do so.
Threshold Mortgages are experts in new build mortgages and Government buying schemes to get you moving.
Do you want to move home but are put off by early redemption charges? Perhaps you’re fixed into a low rate mortgage and don’t want to risk your monthly repayments going up?
These are both valid concerns when deciding whether to sell or stay put – particularly in the current climate. At the time of writing, interest rates have risen 13 times and are set to increase further.
On rare occasions the choice to sell may not be your choice at all but forced upon you by circumstance. Perhaps your company is relocating and you need to move to keep your job. Or maybe an illness forces you to give up work and you suddenly find yourself earning less.
At times like these you might feel your only option is to take a hit on your lender’s early redemption charges and apply for a new mortgage at today’s rates. However, there is another, potentially more attractive, option available to you: porting your existing mortgage to a new property.
Porting a mortgage means that you transfer your current mortgage product from the property you are selling to the property you are buying.
Instead of having to exit your mortgage term early and take out a new one at a revised rate, you can transfer your existing rate to the new property.
Although choosing to port your mortgage means you’ll be retaining your existing interest rate, you may still need to pass an eligibility check in order to satisfy the lender that you meet the affordability criteria for the loan.
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This is very common when porting a mortgage. After all, it’s likely that your new home will have a different purchase price to the home you’re selling.
If you're buying a more expensive property and need to borrow more money, you'll need to take out a second loan to make up the difference. This loan must be with the same lender as your ported mortgage and you must select a product from their current range. This means the rate may be higher than your ported mortgage rate.
Porting your mortgage can allow you to move home while you’re still within a fixed rate interest period and keep your existing rate. In some cases it can also save you from having to pay early repayment charges.
On the flipside, porting a mortgage means that you’ll need to reapply for the loan and may not be accepted for it. You may also have to pay early repayment charges to your lender if you need to pay back any part of the loan early.
For impartial advice about porting your mortgage, you can contact Threshold at 03300 249 115 or email an enquiry using their online form.
For more information about homes on a Charles Church development and information about the mortgage options available, click here to find your nearest development and speak to our friendly sales team.
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