Porting mortgage and borrowing more

[KnackeredOldWoman01]

Hi everyone, I’m looking for some advice and to hear from people who have been in a similar situation.

DH and I bought our home nearly three years ago and took out a 5 yr fixed rate repayment deal on our mortgage, so we’ve got just over two years left to run.

We did intend on staying in our current home long term but for various reasons we have now decided to move and hopefully buy a bigger home, which will cost more. We have £120k left to pay our current mortgage.

I rang our lender who said, Yes, we can port our mortgage over but if we want to borrow more money, we will need a separate mortgage for this?

This is all new to me, but why can’t we just increase our existing mortgage? Is it normal to have two mortgages running at the same time on one property?

Can someone help to clarify things for me! Thank you.

Yes. The reason is because your 5 yr deal won't be available now - no doubt the rates you were offered 3 years ago will be better than the rates you'll be offered now.

So the bank would no doubt allow you to buy yourself out of the 5 yr deal (pay off the early redemption charges and take out a new mortgage for the whole lot) but that option is likely to cost you more than porting the 1st part and getting a new 2nd part.

You'd have £120k on (say) 2% for 2 more years, and then you take out a 2nd mortgage for (say) £100k at 3%. When we did this, it all came out of our account as one payment on the same day.

What you need to work out is the dates on which they both finish so that in the future you can remortgage the whole lot into 1 mortgage (probably better rates, less fees to pay, just easier). No doubt the rates for both parts would be less than the standard variable rate (which is the rate you pay when the fixed rate ends unless you remortgage) so you'd want to minimise the amount of time you'd be paying the SVR if that makes sense. In your shoes, I'd consider getting a 2 yr deal for the 2nd part so in 2 years time both deals will end and you can remortgage all of it in one go.

Thank you