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Porting a mortgage

If you have a portable mortgage you may be able to transfer it to a new property when moving home. Find out if porting your existing mortgage is the right option for you.

In this article
What does 'porting a mortgage' mean? How does porting a mortgage work? Video: porting a mortgage explained
Porting a mortgage to a more expensive property Porting a mortgage to a cheaper property Porting a mortgage vs remortgaging to a new deal

What does 'porting a mortgage' mean?

Porting a mortgage is the process of taking your existing mortgage deal on your current property and transferring it to your new home.

Most (although not all) mortgages are portable, but even if yours is, it's worth looking into whether it's the right option for you.

In theory, porting a mortgage sounds easy, but in reality, it can be tricky (especially if you are moving to a more expensive property) and can cost you more.

 

How does porting a mortgage work?

When you port a mortgage you have to reapply for the deal using your new property.

Your provider will use its current lending criteria to decide whether to let you port your mortgage. Bear in mind that this may be different from the criteria it used originally. Also, if your circumstances have changed, you might not qualify.

Video: porting a mortgage explained

Watch our quick video below to get a simple overview of how porting a mortgage works.

Porting a mortgage to a more expensive property

If you want to buy a more expensive property and need to borrow more money, porting a mortgage can be more difficult and costly.

You will need to pass your lender's affordability checks and you may have to pay a fee to increase your loan, or take on another mortgage product at a different rate.

You'll usually have to pay a valuation fee so your lender can check that the new property is worth roughly what you're planning to pay for it. There could also be an arrangement fee if you have to take out an additional product.

Before asking to port your mortgage, look at the interest rates currently available for your situation to see whether you're on the best deal you could be. If you're not, it may be worth considering exiting your current mortgage and applying for a new one.

You'll need to take all the fees into account - including exit fees for your current mortgage as well as arrangement and valuation fees for the new one - in order to work out what the cheapest option is.

Porting a mortgage to a cheaper property

If you don't need to borrow any more money for your new home - for example, if you're downsizing or buying in a cheaper area - then porting your mortgage could be an attractive option.

Your mortgage lender will run an affordability check based on current lending criteria, so bear this in mind in the months running up to your move and try to maintain (or build) a good credit rating. 

Unfortunately, even if you decide to keep your existing mortgage for your new house, you may still have to pay certain fees such as a valuation survey fee.

Porting a mortgage vs remortgaging to a new deal

Even if you find that you have a portable mortgage and you don't need to borrow any extra cash, it's worth treating your move as an opportunity to look at whether you're still on the best mortgage deal for your circumstances.

Rates have been at historic lows over the last few months, so it's well worth taking the time to do a comparison. This is particularly relevant if you were on an introductory deal when you first took out your mortgage but it's since ended and you're now paying the lender's standard variable rate.

You will also usually have built up more equity in your home since taking out your current mortgage, meaning you may be able to access even better rates.

Make sure you take fees as well as interest rates into account before deciding what to do, as a deal with a better rate could still work out more expensive when you factor in exit fees for your current mortgage and arrangement fees for the new one.

If you're unsure what to do, it's worth talking to an independent mortgage broker for expert advice.

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