Moving from a home you already own isn’t much different from buying your first property. There are just a few extra things to think about, and we can help you with it all.

You might want to keep it really simple, selling where you live and buying your next place. Or you might prefer to keep your existing home and rent it out, which is known as ‘Let-to-Buy’. This could be a one-off investment, or an exciting step towards having a property portfolio. Whatever your plan, we can give you easy-to-understand, hassle-free advice about your options.

Moving home with help from our experts

There are a few things to understand before we get started.

How do you apply?

Whether you decide to transfer your existing mortgage over to your new property, or you want to remortgage altogether, you will need to go through the application process. It’s worth talking to a mortgage broker before looking at potential houses to get a better idea of what kind of loan you can take out.

For every type of mortgage, you will need to apply first, and the process will not be too different to when you applied for your first mortgage. Your provider will do a valuation on your new home and a surveyor will need to check the structural soundness of the property, which will both normally come with a fee. Your lender will also carry out a credit check on you where you will need to provide personal financial details.

If you took out your existing mortgage before the financial crisis in 2008, you will find that the rules have changed and the criteria to qualify for a mortgage have become a lot stricter. Therefore, even though your financial situation may not have changed you may struggle to secure a mortgage under the tougher regulations. This could even apply if you’re only trying to port your mortgage over to a similarly valued property.

What are your options?

When moving home, you can either transfer your current mortgage over to your new property – called porting – or find a new deal altogether by remortgaging with your existing lender or a different one. It’s worth talking to your current mortgage provider or a broker who will advise you on which path to take. Here we will give you a brief run down of the different options available to you.

Porting

Nowadays most home mortgages are portable, which means you can move your current mortgage over to your new property. You will still have to go through the application process for your loan, and you may have to increase the size of the mortgage to cover the cost of your new property if it’s more expensive than your current home. If you need to increase the size of your loan, your lender will often require you to take out a separate mortgage that covers the difference in price. This will come with the added cost of a new arrangement fee, so it is important to check with your lender how much this would be. The additional loan could also have higher interest fees than your original mortgage, so watch out for this too.

Remortgage with your current lender

You also have an option to completely replace your current mortgage, by taking out an entirely new loan with your current provider. Although you might be able to find a better rate this way, you will be hit with extra costs. To leave your current deal, you might have to pay an early repayment charge. The proportion you pay will depend on how much time you have left on your current deal. The closer you are to the end of your term, the less you will have to pay. Normally, the only way you won’t be charged an early repayment fee would be if you’re on your provider’s standard variable rate.

You could also be charged an exit fee, on top of an arrangement fee and valuation fee placed on your new mortgage. It’s important to check which fees you will have to pay and for how much, and weigh this up against the money you will save through a better rate.

Remortgage with a new lender

You can find a mortgage for your new home with a different lender. You could use this to pay off your existing mortgage, or you can also pay for it by selling your home. This could be beneficial to you if house prices in your area have risen significantly since the time you bought your current home. However, there will often be early repayment charges and exit fees for quitting your existing mortgage mid-term. On top of this there may be arrangement and valuation fees on your new mortgage. Make sure you include these in your calculations when deciding if switching lender is the best move for you.

How does the value of your property affect your mortgage?

Your ability to secure a mortgage on your new property, and the rates you will be offered, can depend on whether your new home is more expensive or cheaper than your current one.

Upsizing

If you want to move to a bigger and more valuable house than the one you have now, you will need to prove to your lender that you can afford the higher rates. You will have a higher chance if your current house has risen in value since you bought it. Also, you can reassure your lender that you can afford the repayments by showing your wages have gone up or your outgoings have decreased. If you have had any problems with keeping up with your previous mortgage repayments, you may find it difficult to secure a mortgage for your new property.

Downsizing

If you’re planning to move to a smaller and cheaper home, you should find that the size of your loan will decrease, so your monthly repayments will fall too. You may even be able to buy your new home outright if the value of your current property has increased and the difference in value between your old and new properties is wide enough.

Negative equity

If your current home has decreased in value since you bought it then it is in negative equity. If this is the case, you will find it difficult to secure any type of mortgage for a new home. Some lenders will only provide you with a new mortgage if moving is a necessity, for example if you need to relocate for your job.

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    Keep reading to find information on the process and for answers to some of your main FAQ’s.

    You can also learn about the different types of mortgages and interest rates in our guide.

    Moving Home: Frequently Asked Questions

    Why do I need a mortgage broker?

    It’s easy to navigate the mortgage process when you have a broker that really understands your situation and budget. We’ll pull together all the information you need, spending time with you to get everything just perfect.

    We’ll ask you questions like:

    • What are your plans for the future?
    • What type of job do you do?
    • What’s your income and pay structure?
    • What are your family circumstances?

    We’ll then research the mortgage rates on offer and look at the market to provide you with clear, relevant information you can use with confidence.

    That way, when you’re ready to make a decision, you can do so knowing that you’ve got all the facts.

    What can a mortgage broker do for me?

    Our Mortgage Advisors work closely with you to save you time and give you the very best chance of a successful application.

    During the application process, we’ll:

    • Talk you through all your options with a free initial consultation
    • Recommend the right mortgage for your situation
    • Check how much you can afford to borrow
    • Help you to gather the information and documents you need for your application
    • Help you prepare your application for submission
    • Submit your application to the lender
    • Liaise with the lender, solicitors and estate agents.

    Once your mortgage has been offered, we’ll support you all the way through to completion. We’ll work hard to build a lasting relationship with you. So you’ll always have someone you trust to help with any queries or requirements in the future.

    How does the buying process work?

    We want to make buying a property as simple as possible. The process may sound complex, but we take away all the stress and manage all the paperwork for you.

    Here’s an overview of what happens:

    • First, we’ll work with you to set your mortgage budget
    • You start the exciting bit ‐ viewing properties
    • We help you make and secure an offer on the place you want
    • You instruct a solicitor to handle the legal side of things
    • We finalise and submit your mortgage application to your chosen lender
    • They will survey the property to make sure the mortgage you want is reasonable
    • Once they are happy with the valuation, they’ll make you an official mortgage offer
    • Your solicitor completes the legal process so you can exchange contracts and pay your deposit

    That’s it! The home is now yours and it’s time to collect the keys.

    Top tip: Be prepared

    Make sure you arrange insurance early in the process, because you can’t exchange without it. We can help you with this and recommend providers.

    How does the mortgage process work?

    Getting a mortgage is important, but it doesn’t have to be complicated. We’ll handle every step for you, deal with all the paperwork and take away all the hassle. Here’s a quick overview of how the process works and how we will help you:

    • We’ll talk to you in detail about your situation and budget to work out the maximum you can borrow. This will help make sure you’re looking for properties in the right price bracket.
    • We’ll explain all the documentation we’ll need to put together to support your application.
    • Once you’ve found a property, we’ll find your ideal mortgage and manage the application process for you. We’ll make it as simple as possible.
    • The lender then carries out a survey to assess the property, and their underwriter will review it all to confirm it’s affordable for you. This might include asking for a reference from your employer or accountant
    • Once the lender’s happy with all the checks, they’ll make a formal mortgage offer. Then we’ll help you complete the legal details and exchange contracts with the seller. We’ll be there to talk you through every single piece of paper so you don’t need to worry about a thing.

    What is a new build?

    New build normally means it either hasn’t been built yet, or it’s been completed but never sold or occupied (including show homes).

    Many mortgage lenders also count new builds as:

    • any conversion (such as a townhouse into flats)
    • a substantially renovated or extended property
    • homes built in the last couple of years

    New builds are a popular choice, particular for first-time buyers. Many housing associations offer you the option of shared ownership.

    How does buying 'off-plan' work?

    This means buying a property based on the specifications, but before it’s built. It can take up to 12 months ‐ sometimes longer ‐ for an off‐plan property to be finished and ready for you to move in.

    When buying at this very early stage, it’s a good idea to ask your developer when you’d be expected to complete. This is because you might want your mortgage lender to extend or renew their offer, sometimes more than once. You can end up paying multiple additional fees for re‐valuation.

    When you’re buying off‐plan, it’s a good idea to speak to your mortgage broker to find out what to ask your developer. We can advise you on everything you need.

    What about off‐plan mortgage offers?

    Many mortgage offers are valid for six months. Some lenders’ timescales are longer, and others will offer allowances for extending mortgage offers, as long as your circumstances don’t change.

    After a certain period, your lender may ask their surveyor to conduct a re‐inspection or re‐valuation of your property. This confirms that the property’s expected value is still in line with the amount you need to borrow.

    We give you exclusive access to special new build services from some lenders. These can streamline the whole buying process and improve the likelihood of a successful purchase. They can be particularly helpful when your estimated completion date is far in the future. Give us a call to find out more. We’re always happy to help.

    What about deposit requirement and loan to value (LTV)?

    Normally the value of a property can be assessed by looking at how much previous owners bought it for. This sort of information isn’t available for a new build though, particularly if it’s in an undeveloped area such as a new suburb.

    To increase their security, some lenders will limit the maximum loan to value (LTV) they offer for new build properties. In some cases, additional limitations will also apply if you’re buying a flat. This means that to secure a mortgage in these cases, most lenders will need a larger deposit.

    We give you comprehensive access to lenders who will offer you a mortgage on a new build property and those who accept smaller deposits.

    Get in touch and we can talk you through it all.

    What is contract reassignment?

    In basic terms, this is where one person agrees to buy a property off‐plan, but sells it on before completing. If we talk about Buyer A and Buyer B, this is how it works:

    • Buyer A exchanges contracts and puts down a deposit.
    • Before completing they agree to sell to Buyer B, typically at a higher price.
    • Buyer A “reassigns” the contract to Buyer B.
    • Buyer B now has the rights to complete the transaction.

    If you buy a property on a reassigned contract you could end up paying less that the latest market price. For example, the original buyer could pay £275k, and the property could go up in value to £350k before they decided to sell on the contract. To make a quick sale, they could offer it to you for £325k, so you both get a good deal.

    You also don’t have the long completion date often associated with off‐plan purchases, but it does come with additional risks. Many lenders won’t offer a mortgage based on contract reassignment, so it’s important to seek detailed legal advice from your solicitor and discuss it with your mortgage adviser.

    We give you access to a number of lenders happy to consider contract reassignment purchases, with some limitations. If you want to take this route, feel free to give us a call and talk it through. It’s important we know all the details of your purchase, so we can make sure you get the best advice for your particular circumstances.

    I'm self-employed - what are my options?

    There’s a common myth that the self-employed find it hard to get a mortgage. While the options will vary, there are a number of competitive solutions. To learn more, it’s essential to talk to a knowledgeable Mortgage Advisor.

    A number of lenders specialise in self-employed mortgages and have developed a range options that rely on different criteria.

    This can include:

    • Lending against your most recent year’s income, rather than an average of the last two or three years
    • Lending against your company net profit – rather than just salary and dividends to reach a potentially more positive lending amount
    • Consideration of your daily rate if you’re a contractor.

    Lenders will need to see specific documentation if you’re self-employed. This will depend on your circumstances and we can advise on exactly what it means for you. It’s best to discuss this with us as soon as possible to give you enough time to pull everything together.

    Sole trader, director, contractor or partner?

    The type of self-employed role you have affects how a lender assesses your suitability. Here’s a brief overview of the main considerations:

    Sole trader

    Most lenders ask for a minimum of two years’ of your full trading accounts and personal HMRC tax overviews. They’ll typically also take the average of either two or three years’ of your net profit before tax.

    Some lenders will consider an application if you have only one full trading year, though this depends on your circumstances. For example, have you have switched from employed to self-employed in the same line of work?

    In addition to tax overviews, you’ll need to provide bank statements showing your trading income. If you use a separate account for business transactions, you’ll need to be able to show these account statements to your lender.

    Director

    A lender may class you as employed, but normally only if your share in the company is small. The threshold varies from 5% upwards, but if it’s 20% or more, most lenders will consider you as self-employed.

    The lender will usually require additional documentation to show that the business is solvent, and some will take into account your share of profits, in addition to your salary and any dividends.

    Contractor

    While contractors are typically company directors, many lenders acknowledge the fact that these arrangements are not the same as a corporate company director. This is reflected in their tailored affordability assessments.

    Some lenders will assess contractors using the same affordability assessment as any other company director. However, where this limits the borrowing capacity, there are other options available. The lender can undertake an affordability assessment as if you’re employed and reference the gross contract daily rate as income. This will be subject to certain conditions, including history and continuity of contracts.

    Partner

    Lenders take a range of approaches to assess income and affordability for partners in firms. The options available to you will depend on a number of factors. These include the particular structure of pay, the percentage equity holding in your partnership and the size and nature of the partnership itself.

    There are tailored options available for partners of different sized firms, ranging from small local businesses to large multi-national firms. You’ll need your compensation/drawings/reward statements for the latest year. Ideally, you should have details of the previous one to two years too. You will also need to show details of how you structure your remuneration within the partnership. Lenders may ask for a reference from a senior or managing partner in the business, depending on the circumstances.

    Important information