Can I Port My Mortgage to a New Property in Scunthorpe?

Porting Mortgage Advice in Scunthorpe

How Does Porting a Mortgage Work? | MoneymanTV

If you are a homeowner with a mortgage to your name, you may notice that a certain amount of high street mortgages that are on the market are portable.

A portable mortgage in Scunthorpe works by taking your mortgage from one property to another if you decide to move home and want to avoid the penalty charge for doing so.

For those looking to move into a new home and are already going through your fixed rate mortgage deal, a portable mortgage could be helpful as you will have the potential to avoid having an Early Repayments Charge (ERC) for moving.

Are all mortgages portable?

Remember, not every mortgage deal that is available on the market is portable. This is even less likely if you are on a mortgage with a specialist mortgage lender because their mortgage is probably more complex to qualify initially and they would discourage you to port it.

In order to find out if porting a mortgage will be available to you, we would highly suggest that get in contact with your mortgage regarding this.

Should I port my mortgage?

In some cases, a homeowner may decide that option is not fit for them and choose not to even if their mortgage is flexible enough to achieve this.

There is a range of reasons why customers may not look to port their mortgage. For instance, the mortgage lender may not be willing to provide the additional funds or the different interest rate in those funds.

With this in mind, it may be best to accept the Early Repayment Charge (ERC) and move to a different mortgage lender altogether, however, this only applies if it works out cheaper to go to that new deal.

What is a sub-account?

This is when an account will be attached to your mortgage when you look to port it and the extra funds will move onto a deal different from your original mortgage.

Due to this, each of these will be on two different rates of interest that are applied on both the mortgage and the direct debit.

Keep in mind that because products can overlap, it can become an issue further down the line which means it might need looking into in the future so they are realigned. With this, it may mean one of the sub-accounts falls onto a lender’s variable rate briefly.

Mortgage Advice in Scunthorpe for Porting Your Mortgage

For those looking to Move Home in Scunthorpe or are looking for a Buy to Let in Scunthorpe, contact and speak to a mortgage expert.

Through our 20-plus years of experience as a Mortgage Broker in Scunthorpe, we take pride in helping thousands of mortgage applicants in circumstances like this and will work hard in supporting you towards achieving your mortgage goals.

What is a 95% Mortgage?

A 95% mortgage is as simple as the name would suggest; you are borrowing against 95% of the price of a property, and then you are covering the remaining 5% with your deposit. An example of this is if you looked at buying a property that was worth £150,000 with a 95% mortgage, you would be putting down £7,500 as your deposit and borrow the remaining £142,500 from the lender. 

95% Mortgage Advice in Scunthorpe

Off the back of the March 2021 Budget, Boris Johnson announced a Mortgage Guarantee Scheme for mortgage lenders, making 95% mortgages more readily available from the bigger high street banks.   

This is fantastic news for First-Time Buyers and Home Movers alike, as this scheme will continue running until December 2022. Certain terms and conditions will apply though, which is something your Mortgage Advisor in Scunthorpe will be able to look at, to see if you qualify.    

All our customers who opt to Get in Touch will receive a free, no-obligation mortgage consultation where one of our dedicated mortgage advisors will be able to make a recommendation on the best possible route for you to take.

Can I get a 95% mortgage?

95% mortgages are usually accessible by both First-Time Buyers in Scunthorpe & those who are Moving Home in Scunthorpe. Whilst saving for a 5% deposit sounds like a pretty straightforward concept, you’ll still need to have an acceptable credit score and prove that you are able to afford your monthly mortgage repayments, in order to access a 95% mortgage.

Improving your credit score

A good credit score is essential in the process of obtaining any mortgage, especially a 95% mortgage. Things like paying any current credit commitments on time, ensuring your addresses are updated and checking that you’re on the voters roll, can all help with your credit score.

Affordability 

Affordability is another one that is important to take note of. By giving the lender details of your income and monthly outgoings (things like your bank statements will be necessary for this) and any pre-existing credit commitments, your lender will be able to get a general overview of whether or not you are able to afford this type of mortgage.

Can my family help me get a 95% mortgage?

Nowadays we see lots of family members helping each other get onto the property ladder, especially parents looking to further their children’s lives. The way this usually happens is by gifting the person looking to find their home, the deposit required. Known through the industry as the “Bank of Mum & Dad, Gifted Deposits are only intended to be a gift, and not as a loan. The lender will need proof that this has been agreed, before it can be used towards your mortgage. 

How do I choose the right 95% mortgage?

When looking for a 95% mortgage, you want to make sure you have the right type of mortgage. Each mortgage type works differently, with that choice allowing you to find one that is most appropriate for your personal and financial situation. 

Some homeowners and home buyers prefer Fixed Rate or Tracker Mortgages, mortgage types which mean you either keep interest rates at a set amount for the term given or have your interest rates tracking the Bank of England base rates.

Alternatively, you might find that Interest-Only or a Repayment Mortgages are more your style. Interest-Only allows cheaper payments until you need to pay a lump sum at the end (mostly now used for Buy-to-Lets), whereas a Repayment mortgage (a normal mortgage if you’d like) means you’ll be paying interest and capital combined per month.

How can a bigger deposit help with my mortgage? 

Seeing as a mortgage is such a large financial outgoing, you need to be prepared and need to be aware. You might find things like higher interest rates, remortgaging difficulties due to less equity and then negative equity all cropping up if you’re not. 

There is no need to worry though, as all these can be avoided if you’re savvy enough with your process to begin with. The more deposit you put down for a property, the less risk the lender will see you as. 

A larger deposit, of say 10-15%, would not only reduce the rates of interest by a noticeable amount, but would also give the property more equity and reduce the risk of negative equity, thanks in part to you borrowing less against the property. 

So, whilst the risks may seem intimidating, planning ahead and saving for a bigger deposit to access something like a 90% or even an 85% mortgage will be a massive help in your mortgage journey and something you’ll be able to reap the rewards from in the future. 

Getting Prepared For Your Mortgage in Scunthorpe

Mortgage Advice in Scunthorpe

So, you’ve saved up for your initial mortgage deposit, whether it be from your own savings or a gifted deposit from your parents. What’s the next step for you to take? It’s time for you to get prepared for your mortgage journey!

Know Where You Stand

I’d recommend speaking to an experienced mortgage broker in Scunthorpe as early on in the process as possible, so you know how much you can borrow for a mortgage and how much it will all cost.

Obtaining an up to date credit report should also be at the top of your list, you don’t want a meaningless squabble with your mobile phone provider holding you back from buying a home.

Taking the above two steps will give you a meaningful expectation of how possible this is going to be and what your budget is.

Getting Organised

Your mortgage broker in Scunthorpe will obtain a fully credit-checked agreement in principle on your behalf but you’ll have to prove who you are, where you live and how much you earn.

There really is loads of paperwork for you to get together so it’s a good idea to open a file for yourself and start collecting everything in advance.

Proof of ID

In terms of proving who you are you’ll need to produce some photo ID such as a driving license or passport, if you’re a non-UK national working over here on a Visa you’ll need that too.

Proof of Address

In addition to the above, you’ll need to prove where you live. You’ll need to produce a utility bill or original bank statement dated within the last 3 months.

Last 3 Months’ Bank Statements

The analysis of your spending habits has become one of the most important determining factors in whether you’ll qualify for a mortgage or not. Your bank statements should evidence your income and regular expenditures.

Mortgage lenders will not be happy to see gambling transactions on your account and nor will they like it if you go over an agreed overdraft limit or if your direct debits bounce regularly.

Proof of Deposit

You will have to prove you have the funds in place for the deposit and also evidence this for anti-money laundering purposes.

Try not to move money around your various accounts too much as it will make evidencing the audit trail more difficult. Mortgage lenders like to see your savings building up so you’ll need to account for any large credits into your accounts.

Quite often money for deposits has been gifted by family members. These funds need to be evidenced also and the “donor” will need to sign a letter to confirm it’s a non-refundable gift, not a loan.

Proof of Income

In terms of affordability, the most important thing is to be able to prove your income. If you are employed this tends to be by way of your last 3 months’ payslips and most recent P60.

Mortgage lenders can take into account regular overtime, commission, shift allowance and bonus.

A List of Your Expected Outgoings

It’s a good idea to do your homework and write down an estimate of your anticipated outgoings after you move house.

You can work out an idea of how much the council tax and utility bills will be plus your regular expenditures such as food and drink and demonstrate how much disposable income you have available to pay your mortgage from.

As you can see from the above, it’s a real paper trail when you are applying for a mortgage but if you want your application to run like clockwork you’ll need to put the time aside to get everything together.

Our view is that it’s better to get all this at the outset and collate everything that the Lender could possibly ask for. As this saves time and frustration later down the line if you’re subsequently asked for paperwork you could have had ready at the outset.

Which Property Survey Should I Choose?

What is a Property Survey?

Since this is one of the most common questions that we receive from First Time Buyers and Home Movers in Scunthorpe, we thought that it would be a great idea to cover “What is a property survey?” and the different types available.

When you have an offer accepted on a property your next job is to arrange a property survey.  This will establish the condition of the property and ensure that it is worth what you are going to pay for it. If something is found on the survey you are then in a position by law to approach the seller to negotiate a price for the works required.

Choosing the Right Survey

Here’s a short video from the Royal Institution of Chartered Surveyors (RICS) that explains the different types available to you.

Property Survey Types

There are 3 main types of property survey available to you:

  1. Mortgage Valuation
  2. Homebuyer’s Report
  3. Full Structural Survey

Mortgage Valuation

A basic valuation is the cheapest option and you will be required to have one of these before you receive your mortgage offer.  Please don’t confuse this with a full survey.  The mortgage valuation confirms to the lender that the property is worth at least what it is lending you.

Your mortgage lender may even offer you a free basic valuation as part of your deal.

A Mortgage Valuation will not highlight any repairs that are needed. However, it may point out any obvious defects and recommend that you investigate further.

Homebuyer’s Report

A Homebuyer’s report will cover structural safety and highlights problems, including damp, as well as anything that doesn’t meet current building regulations.  This kind of report will give you an independent report of your property by an expert.

To ensure you are not paying for two surveys it is advisable to ask the mortgage companies surveyor to carry out this report for you – it will usually take a couple of hours to complete.

Full Structural Survey

A Full Structural Survey is advisable for older properties and those of a non-standard construction.

Depending on the property size and type – a full structural survey can take as long as a day to complete.

A full structural survey provides a detailed report on the condition of the property and highlights issues that should be investigated further before going ahead with the purchase, providing you with peace of mind about the condition of your property.

You can find a surveyor to carry out a Homebuyer’s report or building survey through the Royal Institution of Chartered Surveyors.

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