Mortgages for moving home

To port your mortgage, you’ll need to:

• Check the terms of your existing mortgage deal. Ask if your lender will port it and if there’ll be an early repayment charge.

• Speak to your lender about other deals and what you need for affordability checks.

• Get mortgage advice from a broker or financial adviser and see other deals.

• Compare options and work out if porting is worth it. Assess the benefits of your current deal compared to other mortgage options.

• Consider how porting will affect your monthly payments and overall affordability.

• Reapply for the loan.

• Get a mortgage valuation on the home you’re buying.

• The lender will give you a mortgage offer.

If you do not or cannot port your mortgage, you’ll need to apply for a new mortgage deal. You may have to pay an early repayment charge if you’re still in your initial period. Check the costs to ensure this is your best option.

To do this, speak to a mortgage adviser. They will guide you through the entire process.

You can also remortgage to raise money to buy your next home. This works if you are planning to:

• Buy a second home to rent out as a buy-to-let

• Live in part-time for example, in an area close to work

• Move to a cheaper mortgage rate

Additionally, changes in house prices can affect your decision to remortgage. If house prices in your area have risen significantly since you bought your current home, remortgaging could be beneficial. However, be cautious of potential declines in house prices, which could lead to negative equity.

You must consider how the new mortgage repayments will fit your budget.

Renting out your current house

You can remortgage to buy a second home and keep one to rent out.

Given your monthly repayments, you’d need to consider whether the costs of a buy-to-let mortgage and your rental income are worth it.

Learn more in our buy-to-let guide.

Your mortgage will be repaid in full when you sell your home to buy another. You’d then take out a new mortgage to pay for your new home. In this instance, you can use the equity in your home as a deposit.

So if you’ve got a £300,000 mortgage and £175,000 left to pay, you’ll have £125,000 equity. However, if your home decreases in value, you could end up in negative equity, making it difficult to secure a new mortgage and potentially leading to a shortfall between the mortgage amount and the sale price of the property.

The interest rate on your new mortgage will also affect how much you can borrow and your monthly payments.

To find out how much you can borrow, you will need to:

1. get a property valuation so you know how much it’s worth

2. see how much you have left to pay on your mortgage

Using a mortgage calculator, you can determine how much you can borrow.