The best mortgage for your move
Upsizing or downsizing, there’s so much to sort when you’re moving, your mortgage has to be one of the main things!
When you’re moving you’ll need to know if your mortgage is portable and if it’s best to keep that mortgage or take a new one out for your new home
Even if you have a portable mortgage already, any extra borrowing will mean that your lender will apply their lending criteria to the mortgage – meaning that you might not get the extra you need – especially if your circumstances have changed.
If you decide to change mortgages then your old mortgage could have an Early Redemption Charge or Penalty (ERC) which they add to the balance being repaid. This is commonly the case if your mortgage is on a fixed or discounted rate and it’s been arranged recently so if you’re planning on a move in the next year or two – discuss that with your Acorn.mortgage broker when you discuss things.
If you’d like to keep your costs as low as possible when you move try to do the following;
- Plan your move as far ahead as possible – if you know years or months in advance you’ll be able to avoid expensive tie-ins
- If you think you’ll be changing your mortgage in the next few years then a variable rate mortgage might be easier to cancel than a fixed rate
- If you can wait until the end of a fixed rate or an aniversary when the ERC reduces it might save you thousands.
If things are going well and you’ve got more equity from your old home – that might make you more attractive to mortgage lenders and get you a better interest rate on a new mortgage. So it’s well worth checking your situation with one of our experts before deciding what’s the best plan for your house move.
Other options to a house move mortgage
If you’re property has not sold and you want to get on with the purchase you have other options available;
- A let to buy mortgage – you rent out your property, remortgage to release enough equity for your move and then, maybe use this property to jump-start into property investment.
- A Bridging Loan – useful in a competitive situation but can be an expensive means to fund a property so take advice first.
Once you’ve got moving house mortgage sorted then you’ll need to start planning the move – here’s a great checklist from Money Saving Expert