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Remortgaging for move(15 Posts)
Hi, I'm hoping for some advice/perspective on the issue I'm faced with.
At present I have a lifetime base rate tracker at 0.49% above base. I was told it was fully portable.
I am now buying a house with my partner and have asked to port the mortgage and take out an additional mortgage to cover the balance.
The mortgage company will not allow us to take the additional mortgage at the rates they advertise in branch, in the papers and on moneysupermarket.com and similar websites.
The rate they are offering us is nearly double the best rate they are offering.
I am thinking of complaining because it seems that they are offering a rubbish rate for the additional mortgage simply to get me to give up my life time tracker. This seems to me to be sharp practice.
Does anyone have any experience or advice they would share with me?
Your conclusions sounds spot-on. A complaint may be premature but I'd certainly want to know what their official reason is why the top-up amount attracts such a high rate. If you get that and it seems unreasonable then you could take it further.
It is portable but you are wanting to take out a new loan for a higher amount. If you just move and port your mortgage they will honour the rate since you are keeping the same loan. If you increase the amount this is counted as moving from one loan to aother, you can't just increase the amount.
This is perfectly standard unfortunately and complaining is unlikely to get you anywhere.
Its also standard to refuse to allow you to have two separate mortgages on the same property I'm afraid.
Thanks for your replies.
My problem is that they are offering additional mortgages for movers on their website at a lot lower rates than they have offered us.
I disagree that it's unusual to have more than one mortgage with the same provider at one property. I have had one with this company (although I paid off the additional one some years ago to leave just the life time tracker).
It appears that they are not offering to existing customers what the website says they offer! This seems to be grounds for complaint.
I need to make my complaint quickly because I need a mortgage offer to proceed with my purchase. I just don't have time to spend going through the motions.
huh? i am with nationwide and have 3 mortgages on our property!
What is your loan to value on the property? The advertised rates are always the lowest ones, however you may only be able to borrow (for example) 50% of the property value to be eligible for this rate. Alternatively is this just a rate for new customers? It's not unheard of for the existing customer rates to be better, but it must say in the t's & c's that it's new customers only ( like insurance companies offer new customer discounts).
Absolutely normal to have more than one mortgage through the same lender on a property. I certainly do. Have you been trying to re-mortgage through a call centre? I would make an appointment and go through the detail with a fine tooth comb with their financial advisor in branch. It does seem that the rates for existing customers are sometimes worse (and less well advertised) though usually not as bad as you describe.
Which organisation is it by the way?
Looks like we were fobbed off then when wanting to add on a separate mortgage. We were told that it was very unusual and not permitted except for very specific products (with rubbish rates)!
Is it Hsbc by and chance? Our mortgage is also lifetime tracker 0.49% above base rate, can port it etc so our rate is currently 0.99%. As far as I understand it you can't lend the extra on a brand new mortgage product. You may be able to lend extra but it has to be the same product so the current lifetime tracker that you have just at the rate it is sold at today if that makes sense. We have been looking to release some of our equity and the mortgage we have is now being sold at a rate of 2.4% above base rate. I would think the extra can be on what ever product you want as long as you meet their criteria.
When we moved last year the Halifax lent us the same amount that we'd remortgaged for last time at the same rate we were currently on, and then the rest was made up with the same type of mortgage but at a higher rate. So we borrowed, say, 50,000 at the 0.49 % that we were already on, which was what we had left to pay on the old mortgage when we last switched rates, and then they lent another 100,000 on top on the same type of mortgage but at a slightly higher rate. I don't know whay they were only able to offer the low rate for the same amount as we had last time but apparently it was a rule.
I think I understand what I've written! Hope that helps.
It's Santander (was Alliance & Leicester). I appreciate that the new mortgage would be at a higher rate, I wasn't expecting them to increase the current loan. We're looking to increase the total mortgage by about 100%. The LTV ratio is 70% (30% deposit) so I understand that some rates aren't available to us.
I'm pleased to hear of others who have taken additional mortgages with the same company. It's our Financial Adviser who is dealing with the mortgage companies, not us .
I'm finding this frustrating because of the deadlines involved.
Yep - we did this about three years ago with Alliance and Leicester. Ported our current mortgage - which was/is also a very advantageous tracker and took out an extra mortgage for the additional cost. Thing is the rates for remortgage, unless you've got a massive deposit with Santander just aren't that great at the moment, I think the best fix is about 3.39% and a tracker probably base rate plus 1.99%, but the fees for these are huge.
Why are you dealing with a financial advisor for this? They can't shop around for you unless you want to lose your current good rate. Doubt they can get you a better deal and are just stopping you taking control of the problem and getting the information and having the important conversations yourself - I think you would probably find you had the answer if you had gone direct, but I suspect the truth is that they are not penalising you because of your current rate, but just offering really bad deals on remortgage to all customers!
I have learned more - when porting an A&L mortgage to raise an additional mortgage you must take a further A&L mortgage. However the mortgages offered are the new Santander mortgages which are the old Abbey range. This restricts our choice of additional mortgage to just the tiny range that A&L have retained. It's an explanation but not particularly satisfactory.
As you say RufousBartleby the rates just aren't great from A&L/Santander.
The IFA did look at everything on the market available to us but I specifically asked him to look into the porting option.
Anyway, we've now got an agreement in principle with a different provider for the full mortgage. I guess it makes it easier in two years time when this tracker expires to consider moving to a new provider. We aren't tied to Santander.
There's been loads in the press about "portable" mortgages not being honoured by lenders and if you have an amazing rate, then they will do whatever they can to get you to give them up. It sucks. We are unlikely to move for this very reason as we also have a low lifetime tracker.
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