Idiot guide to mortgage

[Littlemissimpatient]

I'm really not sure how this all works as never sold a house before. DH and I bought a new build 5.5 years ago. The builders paid loads as we were first time buyers, 5% deposit, stamp duty etc. we're now looking at moving, although we have a lot more saving to do for a deposit as we have lost around £30k off our house. If we sell ours for say £120k but we have £130k on our mortgage what happens to that 10k?
We're looking at a house around 200k if we can afford it so if we get a 90% mortgage we would be adding 60k to our mortgage is this right? I'm getting very confused!

If you sell your house at £120K, with £130K outstanding on the mortgage, you'll have to pay that to the mortgage provider yourself i.e. get the £10K money from somewhere. You would effectively be starting from scratch with buying a new home so if both salaries don't qualify you for a £200K mortgage, you won't be able to buy the new home. I'm no expert though, so you might well have a way around this that I'm not aware of, but from what you say, I'm not sure selling your home now would be an option, unless you have the £10K saved, and qualify for a mortgage for £200K for your new home. I'm not aware of anywhere that does 100% mortgages nowadays, and even 95% is rare and very expensive, so you really would need a lot more than the £10 to settle your existing mortgage i.e. some kind of lump sum to put down as a deposit.

For what it's worth, I'm in a similar situation i.e. can't sell as I'd lose too much money from sale, and what I'd be left with still wouldn't get me close to a mortgage for a new place as I'd be about £20/30K short on what I qualify for a mortgage. Some places will lend more, but you need to be certain you can actually afford the mortgage. One lender was willing to give me £124K based on income, tax credits and maintenance, but I'd never be able to afford to live with the mortgage payments for that size of mortgage. I can barely afford my mortgage for half that amount! There was also the small detail of me not actually getting tax credits in my pocket as they pay for childcare with me topping up the shortfall, so not really what any mortgage offer should be based on.

Sorry mis-read your initial post. I'm really not sure it's as straight forward as just adding £60K to your existing mortgage. Your best bet is to speak to a financial advisor and take it from there. They'll be able to see what your options are etc.

You are in negative equity by the looks of it and so would have to find the extra 10k out of savings to clear your mortgage. You would then need a new mortgage for the new house. It's difficult to get over 90% loan to value these days, so you would need £20k deposit for a £200k house plus legal costs etc Then, yes you would have a £180k mortage

Thanks, as I thought.
We're never going to get out of here. We can get a mortgage for the house I like, we just don't have the deposit!

If you're looking at a more expensive house and adding £60k extra to your mortgage you must have worked out that you've got plenty of spare in your budget. Why not start putting that aside into a savings account or ISA?

We can but to cover our deposit, and costs it will take at least 12 months. To add an extra 100k to our mortgage is less than I initially thought. We need to move for my work cos at minute I'm commuting an extra 3 hours a day than where we want to move to.