Porting a mortgage from one home to another explained
Find out all you need to know about how to move your current mortgage with you to your new home.
Key takeaways
Porting a mortgage involves transferring your existing mortgage to a new property while retaining the same terms and conditions
If you’re tied into your current mortgage deal, porting helps you avoid ERCs that would apply if you paid off the mortgage early, but consider that not all lenders offer portable deals so check your agreement
Porting a mortgage often involves a process similar to applying for a new mortgage, the lender will reassess your credit history, income, and outgoings to ensure you still meet their criteria
If you need more funds for a more expensive property, you might have to take out a second mortgage at a higher rate
What does porting a mortgage mean?
Porting a mortgage is the process of transferring your existing mortgage, with all its current terms and conditions, from the property you're selling to the one you're buying. This can be an attractive option for many, but it's important to understand the ins and outs before making a decision.
Why would you port your mortgage?
There are several reasons why homeowners port their mortgages. Most likely because you are tied into your current mortgage deal. If you were to pay it off and take out a new mortgage for your next home, you’d be hit with early repayment charges (ERCs).
Equally, you may not be tied in but want to keep hold of a particularly competitive rate.
What are the steps involved in porting a mortgage?
Check your original mortgage offer to see if it's portable
Consider your circumstances and whether you're still eligible for the deal
Apply for the mortgage port
Wait for the property valuation, underwriting, and re-assessment of your finances
Wait for your application to be approved
Are all mortgages portable?
The majority of mortgages – whether they are fixed or variable – are portable. However, some smaller or more specialist lenders may not offer portable deals.
It’s also less common among buy-to-let mortgages. Always check the specifics of your mortgage agreement to see if porting is an option for you.
Whether or not you can port your mortgage also depends on whether you pass the relevant checks the lender lays out.
Is porting a mortgage easy?
While the concept of porting a mortgage might seem straightforward, the process can vary significantly from one lender to another. It often resembles a standard mortgage application, where the lender will reassess your credit history, income, and outgoings. This is to ensure that you still meet their borrowing criteria.
What happens to equity when porting a mortgage?
When porting a mortgage, the equity from your existing property can be used towards the new mortgage loan amount. This allows you to potentially use the value you have built up in your current property to reduce the amount you need to borrow for the new home.
Do I need a broker to port my mortgage?
No, you do not necessarily need a broker to port your mortgage. However, consulting with a mortgage broker can be beneficial as they can provide advice on your options and ensure you are getting the best deal possible.
It's particularly useful if you're unsure about the process or need help comparing current mortgage rates.
How quickly can you port a mortgage?
It can take 30 days to three months to complete the process of porting your mortgage, but the exact time depends on the lender and your circumstances. Factors that affect the time it takes to port a mortgage include:
Factors affecting time it takes to port your mortgage
Lender
Some lenders may be more or less likely to approve a mortgage port
Property
The type of property you want to buy may affect your application
Finances
Your lender may perform an affordability check
Complications
If you need to borrow more money or there are issues with the new property, it may take longer
Do you pay stamp duty when porting a mortgage?
Yes, you need to pay stamp duty when buying a house, even if you're porting your mortgage. The amount depends on the cost of the new home and its location.
Are there advantages to porting a mortgage?
There are clear benefits to porting your mortgage. You can avoid ERCs, potentially enjoy a faster application process compared to starting over with a new mortgage, and you might be able to maintain a favourable interest rate.
What should I look out for when porting a mortgage?
Porting isn't without its challenges. You'll need to go through a new application process, which could be stressful during a move. If you need additional funds for your new property, you might have to take out a second mortgage at a higher rate, which can complicate your finances.
What if my lender refuse to port my mortgage?
Your lender can refuse to let you port your mortgage. If they won't let you do it, you might have to wait until your current mortgage deal ends. This could be a short wait if you've only tied in for two years.
If the lender declines on the basis of the property itself, you may want to consider if you want to buy or, at the very least, get a comprehensive survey to understand the property's condition better.
Can I change my mortgage to a buy to let and release equity?
Yes, you can change your residential mortgage to a buy-to-let mortgage by requesting a change from your current lender.
You can also release equity from your home by remortgaging, either by replacing your original mortgage or taking a second charge mortgage. These options allow you to rent out your property and potentially access additional funds.
What happens if I port my mortgage to a more expensive property?
Moving to a pricier home means you'll likely need additional borrowing. The equity from your current home can serve as a deposit, but any extra borrowing will be subject to the lender's current rates. It's wise to align the tie-ins between your main mortgage and any additional loans to avoid financial strain.
Can I port a mortgage to a cheaper house?
Yes, you can port a mortgage to a smaller amount if you're downsizing. This may put you in a position to pay back some of what you owe to the mortgage lender. Most mortgage deals will allow you to repay up to 10% a year of the outstanding balance each year without a charge.
However, the interest rate from your existing mortgage will only apply to the part of the balance being ported. For any additional funds required, you might need to secure a separate mortgage product or deal.
If you want to repay more than this and are tied into your deal, an early repayment charge (ERC) will apply.
Are there fees involved in moving my mortgage?
While there are no specific fees for porting, you may need to pay a valuation fee for the new property. This fee varies by lender and property value.
Can I still port if I don’t sell and buy at the same time?
Some lenders offer a grace period, typically around three months, for you to complete the porting process. If you manage to transfer the loan within this period, any ERCs you've paid may be refunded.
When considering a move, it's vital to weigh all your options. Porting your mortgage can be a savvy financial move, but it requires careful consideration and a clear understanding of the process.
Are there any circumstances where I won’t be able to port?
Porting is not a guaranteed process, and several factors can stand in your way. Changes in your personal circumstances, such as a decrease in income or a lower credit score, can affect your eligibility.
If the new property doesn't meet your lender's criteria or is valued lower than expected, you might find yourself unable to port.
Our other useful guides
Remortgaging With The Same Lender | MoneySuperMarket
Do I Need a Mortgage Broker or a Lender? | MoneySuperMarket
Can I sell my home to a family member? | MoneySuperMarket
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Author
Collette Shackleton
Content Writer
Collette Shackleton is a highly skilled Content Writer who has over nine years’ experience creating helpful and engaging personal finance content for consumers. Collette shares her experience as a...
