Home Movers Guide
Updated: May 3
If you have made the exciting decision to move to a bigger home for more space inside and/or out, or because of work, or because you are downsizing to something more manageable, you will already have a good idea how the mortgage process works because you have been through it before. However, there are many mortgages out there so it is worth seeking advice as to the right deal for your needs. It may even be better to keep your existing mortgage and ‘port’ it to your new property, or you may face early repayment charges (ERCs) if you are part way through a deal.
Before you start looking at potential new homes, it is worth getting in touch with a whole-of-market broker, such as home-me, to find out how much you can borrow. This is particularly the case if you hope to buy a bigger property with a larger mortgage, as your income will need to support the higher mortgage payments.
This will also ensure that you don’t waste your time, viewing properties that may currently be out of reach. We can give you a ‘decision in principle’, setting out how much you could borrow. Estate agents and vendors will take you more seriously if you have already sought advice from a mortgage adviser, and it could put you in a favourable position.
Once you have had an offer accepted on a property, home-me can process the mortgage application on your behalf. As we are whole-of-market, we will look at all the lenders on the market to find the best deal for your specific needs. You will need to supply us with proof of income, bank statements, a recent utility bill and proof of identification.
The lender will instruct a valuation so that it can check that the property is value matches the sale price. Once this comes back and everything is ok, the application usually proceeds to offer stage.
Keeping your existing mortgage
It may be beneficial to ‘port’ your existing mortgage to your new property, rather than taking out a new deal. This enables you to keep an existing low mortgage rate so may be worth doing, particularly if it means avoiding paying early redemption charges for getting out of a fixed-rate mortgage early.
Not all lenders will let you port your mortgage but many will, as long as the property you are buying fits its criteria. You will still have to go through the application process and you may have to increase the size of your mortgage if the property you are buying is more expensive. This would be in the form of an additional loan, which may be at a higher rate of interest and there may also be fees to pay, so get a broker such as home-me to check the numbers and work out whether it is worth doing.