Who is classed as a home mover?
You will be seen as a home mover if you currently have a mortgage on a property and are looking to move to a new one. This doesn’t necessarily mean you will need to take out a new mortgage on the new property.
How do home mover mortgages work?
You firstly need to work out budgets, deposit size and your monthly costs for buying a new home. In this case, your deposit will mostly consist of equity you have built up in your current home. Ensure you are in a good financial position to go ahead with the process. Remember, a lender will assess your financial situation too, so if you don’t think they will be satisfied, maybe rethink your options.
You will now need to research the market and explore what options are available. Using a mortgage broker to do all the hard work for you can be very beneficial.
Once you’re happy with the options you have explored, you can apply for an agreement in principle with the best lender. This will put you in a strong position when you come to make an offer on a property.
After you’ve made an offer and it’s been accepted, you can begin to prepare your mortgage application. Choose the most appropriate product, rate and lender that suit your circumstances. Once ready, you can submit your application to the lender.
If your application is accepted, your solicitor will organise all the contracts involved. You can then exchange contracts and look to set a moving-in date that aligns with the sale of your current home.
What costs do home movers face?
Like with your current mortgage, there will be a range of fees you may need to pay. According to the HomeOwners Alliance, in the UK in 2024 the average costs of moving house is £10,255.
Some costs you should consider as a home mover are:
- Legal fees – when moving home there are always a range of legal elements that must be satisfied, so you will need to employ legal support.
- Stamp duty – as you are no longer a first-time buyer, there are no exemptions from paying stamp duty. If you’re purchasing a property over £125,000, you will be required to pay it.
- Surveyor fees – it’s likely that a lender will require you to get your new property surveyed and valued by a qualified professional.
- Mortgage broker – if you choose to use a mortgage broker to assist with your mortgages, they are likely to charge you.
- Estate agent – when selling your current home an estate agent may be required.
- Moving costs – there are a range of costs when you move house, e.g. removal company, postal redirection, and/or hiring a van.
What to do If I already have a mortgage?
In this situation, many lenders offer the option to your mortgage from your current home to your new one.
Porting is essentially when you buy a new home but keep your existing mortgage. Therefore, you will keep the rate you are currently on, instead of remortgaging to a potentially higher rate.
You will need to check your existing deal to see if it’s ‘portable.’ Keep in mind that not all mortgages are portable, so always check your term first.
If you wish to port you will need to reapply with your lender, meaning they will need to reassess your eligibility. So, if they don’t believe you’re in a suitable position to port, they can decline your request.
Your finances and the new property’s loan-to-value (LTV) all play a part in a lender’s assessment.
It’s possible to borrow more if the new property costs more than your current home. In certain cases, a lender may be happy to increase the loan amount to cover the additional cost. However, it’s likely that you will be charged a higher interest rate on the additional amount.
Another option that may be suitable is to take out a separate loan on the additional amount required. Again, the interest rate could be higher than the one on the original mortgage amount.
One final solution is to look at remortgaging options. In some situations it can work out better to remortgage for the higher amount. Instead of keeping the same product, you would receive a new one, and it’s likely that this will come with a different interest rate.
How can a mortgage broker help home movers?
Moving house with a mortgage can be a very exhausting and long process. A mortgage broker can do the work for you and ensure you get the right deal.
At IMC Mortgage Brokers we will help you work out your budget going forward and establish how much you can buy your new home for. We will calculate the costs of selling your existing property and purchasing your new home (legal fees, agent commissions, stamp duty etc). Getting this right from the beginning is very important.
As whole of market mortgage brokers, we have access to a range of products. Therefore, we can access exclusive mortgage rates that you won’t find on the high street.
Get in touch today to organise a free no-obligation consultation discussing your circumstances.