Moving to a new home is a significant milestone, often accompanied by unique financial and logistical challenges. Whether upsizing, downsizing, or relocating, understanding the intricacies of the mortgage landscape is vital. A Home Mover Mortgage Advisor is your trusted ally, helping navigate the complexities of buying a new home while managing an existing mortgage.
The Mortgage Process for Home Movers
Navigating the mortgage process as a home mover is different from being a first-time buyer. It includes evaluating your current property’s equity, understanding porting options for your existing mortgage, and identifying the best new mortgage deals. A Home Mover Mortgage Advisor provides essential support at every stage, ensuring a smooth transition.
The Benefits of Working with a Home Mover Mortgage Advisor
A Home Mover Mortgage Advisor offers numerous advantages. They deliver customised advice suited to your unique situation, assist in comparing various mortgage options, and simplify complex financial jargon. Their expertise is key in finding a mortgage solution that aligns with your current and future housing needs.
What to Expect from a Home Mover Mortgage Advisor
Your advisor should be a well-informed guide throughout your home moving journey. They will offer insights into the current housing market, assist with financial planning for the move, and explain options like mortgage porting or additional borrowing. They’ll also help you understand additional costs associated with moving homes.
How to get a mortgage as a Home Mover?
For expert, reliable, and clear mortgage guidance, our team at Kerr & Watson stands ready to assist. With extensive experience in the home mover market, we are equipped to support you in every aspect of your mortgage process.
Find out Your Options
Who Are Kerr & Watson?
Kerr & Watson is an independent regulated mortgage and insurance broker with comprehensive market access. Our deep industry experience and strong relationships with mainstream lenders, niche mortgage providers, and insurers position us ideally to find the perfect mortgage and insurance solutions for you. We are committed to offering tailored financial strategies that cater to your individual requirements as a home mover.
About Home mover mortgages
Moving home is an exciting chapter in life, but it also brings financial considerations, especially regarding your mortgage. As a homeowner, you have various options to manage your mortgage when transitioning to a new property.
Porting Your Mortgage: A Popular Choice
Most mortgages are “portable,” meaning you can transfer your existing mortgage to a new property. This option is particularly appealing because it avoids early repayment charges (ERCs). With current UK mortgage interest rates on the rise, retaining your existing deal can be a financially prudent move. However, there are critical aspects to consider:
- Approval is Not Guaranteed: Despite maintaining the same mortgage, re-qualification is necessary. This involves affordability checks and a valuation of your new property. To check affordability use our mortgage calculator as a guide.
- Challenges When Upsizing: Moving to a more expensive property might complicate porting. If additional funds are needed, some lenders may require a separate mortgage for the excess amount, potentially leading to different interest rates and terms.
Home Mover Mortgages: A Tailored Solution
For those unable to port their mortgage or seeking better deals, a home mover mortgage can be an alternative. These are designed for existing homeowners and have distinct considerations:
Potential Exit Fees: If you move to a new mortgage before your current deal ends, ERCs may apply. Assess the costs to determine if switching is financially beneficial.
Porting Advantages When Downsizing: If your new home is less expensive and doesn’t require additional borrowing, porting can be a more cost-effective and quicker option.
The Pros and Cons of Lender Loyalty vs. Switching
Staying with Your Current Lender:
- Avoidance of ERCs and arrangement fees.
- Often quicker and simpler.
- Potentially better terms than new deals.
Switching to a New Lender:
- Access to potentially better mortgage deals.
- Simplified borrowing if current lender imposes limitations.
- Opportunity to renegotiate interest rates, repayment types, and terms.
A mortgage broker can offer invaluable advice, providing access to deals and guidance on whether to port or switch.
How Property Value Affects Your Mortgage
The value of your new home is a significant factor. Upsizing may impact your loan-to-value (LTV) ratio, while downsizing could increase it, affecting your mortgage options.
Increasing Mortgage with Same Lender: Some lenders may allow an increase in loan size when porting. For instance, with HSBC, additional borrowing may involve a new rate.
Reducing Mortgage Size: If downsizing, lenders might require loan repayment to maintain the LTV. For significantly cheaper properties, a new mortgage with another lender might be necessary.
Deposits and Equity in Home Moving
Unlike first-time buyers, home movers often use the equity in their current home as a deposit. This includes the original deposit, mortgage repayments, and property value appreciation. However, substantial equity is advantageous, especially when upsizing.
Moving in Negative Equity: This situation, where your home’s value is less than the mortgage, complicates moving. Consultation with a mortgage broker is advisable.
Key Considerations for Home Movers
Porting vs. New Mortgage: Porting allows keeping the current interest rate, but involves affordability and credit checks. A new mortgage may involve ERCs and meeting new lender criteria. To check affordability use our mortgage calculator as a guide.
Repayment Changes: Expect some changes in repayments, depending on whether you borrow more or less in the new property.
Deposits: Equity in your current home can serve as a deposit. Boosting your LTV ratio with additional savings can be beneficial.
Agreement in Principle: This might be less critical when moving house but still signifies buyer seriousness.
Conclusion
In summary, moving home requires a strategic approach to mortgage management. Whether porting your mortgage, switching to a new lender, or adjusting your borrowing based on property value, each option has its implications. Careful consideration and expert advice can ensure a smooth financial transition to your new home.
Contact Kerr & Watson for your home mover mortgage.
