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What happens to my mortgage when I move home?

If you're planning to move to a new property, it's important to understand your mortgage options and any possible extra charges you might face so you can factor these in to your moving costs.

The majority of mortgages can be transferred from one property to another, although sometimes this can be easier said than done depending on your circumstances.

Here's what you need to know...

Can't I just get a new mortgage when I buy a new home?

If you're currently on a mortgage which doesn't have any early repayment charges, you should be able to redeem this mortgage when you sell your property and take out a new mortgage on your new home. Remember that there will usually be set-up costs for your new mortgage, so make sure you consider these before applying.

However, if you're tied into your current deal, and will be hit with hefty charges if you leave it early, it may be more cost-effective to transfer your mortgage across to your new property, provided it is portable.

If you're not sure whether moving your mortgage to your new home is the right decision, it's a good idea to get expert advice. They'll be able to do the sums for you to help you decide whether you'll be better off switching to a new deal or sticking with your existing mortgage.

How easy is it to transfer your mortgage to a new property?

When you transfer your mortgage, you effectively have to reapply for it, so you'll need to meet your provider's lending criteria at the time.

You'll need to provide proof of your identity, as well as evidence of your income and outgoings, so that your lender is comfortable you'll still be able to afford your monthly payments, even if they won't change.

The lender will also want to carry out a valuation on your new property so they have independent confirmation of how much it's worth. If your lender refuses your application to transfer your mortgage to your new property, you may decide it's worth paying early repayment charges to switch to a different lender. If, however, these costs are too high, you may decide to postpone your move until your mortgage deal finishes.

What happens if my new home is more expensive than my current property?

If you're moving to a property which costs more than your current home you may need a bigger mortgage, so check with your lender to see if they'll lend you the extra funds you'll need.

If they agree, you will probably have to borrow any additional money at a different rate to the rest of your mortgage. It's a good idea to try and ensure any top-up deal finishes at about the same time as your current mortgage, so you can then remortgage the full amount to the same deal.

What if my new property is cheaper?

If you're moving to a property which costs less than your current home, you may need to reduce your mortgage.

Depending on whether you're tied into a particular deal, you could have to pay some early repayment charges on the amount repaid.



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London & Country is the UK’s largest fee-free mortgage broker, so you won’t pay a penny for the expert advice you need to find the right mortgage for you! London & Country provide blogs designed to save you money and hassle, exploring the UK finance market and offering advice on how you should approach your mortgage and insurance products. London & Country can be found at www.landc.co.uk

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