Talk to your lender

The best way to handle the situation is to involve your present lender or mortgage broker when you're first thinking about moving, and see what they advise.

Most mortgages are portable, meaning that you can transfer them from the property that you originally borrowed against to the home to which you want to move.

Lenders will want to value the property – and you may need to borrow more to secure it.

There may also be fees to pay for the transfer. A few hundred pounds is typical to port a mortgage to a new property.

Remortgaging penalties

Moving home, however, is often an opportunity to look around for a better mortgage deal. 

Like any remortgage, you should start by checking whether there are any penalties to pay on your existing home loan.

In particular, there are likely to be fees and additional interest charges if you’re still in the special offer period of the loan – on a fixed or discounted deal rather than the lender’s standard variable rate.

In order to be better off by moving mortgage provider, you'll need to find a deal that's sufficiently cheap to cover the cost of these penalties. 

Look for a better mortgage

This isn't impossible, though it will be easier to save money if your current deal is penalty-free.

Mortgages for those moving home are increasingly competitive, with variable rates starting at around three per cent and fixed rates currently priced a little higher.

But don’t forget to consider the impact of arrangement fees and other charges lenders may levy – these will typically be added to the mortgage value, but will add to the headline rate of interest payable.

Moving house?

Use our advice to help you prepare for a stress free moving day.

Credit assessment

If you're thinking of moving your mortgage, you're also likely to be assessed against a much stricter criteria than before the credit crunch.

You'll normally be asked far more questions than you might have been previously, and there'll be a lot more paper-chasing involved before you'll be able to move your mortgage.

When it comes to transporting your current deal to a new property, you must remember that you'll have to meet the lender's criteria at that particular point in time. 

So, while your circumstances might not have changed, your lender's criteria might have got much stricter, which means you may no longer be eligible to move your mortgage.

Switching mortgage lenders

When times are tough, as they are now, you could find that especially if you're upsizing and wanting to borrow more, that your lender may not allow it.

If you find you can't transport your mortgage to a new property, then your only option will be to stump up any early redemption penalties and to move lenders, or to stay put in your current property

Therefore when taking out a mortgage always give lots more thought as to when your next move might be before you lock yourself into another mortgage deal - even if it is 'portable'.

You may be better off going for a two or three-year fix so that when you do move you can shop around and have a choice of deals so you aren't restricted to the same lender.

Which? Money Compare

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