How do I port my mortgage if the property I am buying is cheaper?
If a mortgage is portable it means that it can be moved over to another property. The advantage of this is generally that there is no requirement for a change in the rate and importantly any applicable early repayment charges (ERC) will not be incurred.
However, you will need to satisfy the lenders current lending criteria and they will underwrite the mortgage in the same way as any other mortgage, requiring information about and evidence of income.
As you are downsizing then you will need to repay a chunk of the existing mortgage from the sale of your current property so that there is some equity in the property. That could mean that a partial early repayment charge would be incurred on the
amount redeemed depending on the terms of the existing mortgage.
If you do not have any ERCs on the current mortgage then you should be free to see what other deals your lender has to offer and to shop around the open market to see if there is a better deal available.
The answers above are for guidance only and should not be acted upon without you receiving professional mortgage advice relevant to your circumstances. To find an independent mortgage adviser please go to http://www.unbiased.co.uk
David Hollingworth, Head of Communications, London & Country Mortgages (www.lcplc.co.uk)
London & Country is a fee-free mortgage broker offering whole of market advice to borrowers across the UK. I am frequently asked to comment in the national press and media on all aspects of the UK mortgage market.