Moving Home Mortgage Guide
Porting, Selling & Buying at the Same Time
Moving home can involve considerably more than simply finding another property and transferring your existing mortgage across.
You may be selling one property, buying another, repaying an existing mortgage, using equity as your new deposit and arranging additional borrowing — all within the same transaction.
If your current mortgage has a competitive fixed rate or an Early Repayment Charge, you may also hear the word “porting.”
Porting can be useful, but a portable mortgage doesn't mean you can automatically move your existing loan to any property you choose.
This guide explains how mortgages can work when moving home, including porting, additional borrowing, Early Repayment Charges, equity, affordability and the practical challenge of coordinating a sale and purchase.
What Happens to My Mortgage When I Move Home?
Your existing mortgage is secured against your current property.
When that property is sold, the mortgage normally needs to be repaid as part of the sale.
If you're buying another property, you may then need a mortgage for the new home.
Depending on your circumstances, you might:
Arrange a completely new mortgage
Port an existing mortgage product
Port your existing product and borrow additional money
Repay the existing mortgage and choose another lender
Buy the next property without a mortgage
Which route is appropriate depends on your existing mortgage, new property, affordability and plans.
What Does Porting a Mortgage Mean?
Porting generally means taking an existing mortgage product with you when moving home, subject to the lender's terms and approval.
For example, you may have several years remaining on a fixed-rate mortgage and want to retain that product when purchasing your next home.
However, the mortgage itself isn't simply detached from one property and attached to another.
Your lender will normally need to assess a new mortgage application.
Is My Mortgage Portable?
Your mortgage offer or current lender should provide information about whether the mortgage product has a portability feature.
However, seeing the word “portable” doesn't mean the lender is required to approve your next mortgage.
Portability gives you the potential ability to retain the existing product subject to the lender's applicable terms.
You still need to satisfy its requirements.
Does Porting Guarantee I Can Keep My Existing Rate?
No.
This is an important distinction.
Even if your mortgage product is portable, you may still need to:
Pass the lender's affordability assessment
Meet its current lending criteria
Pass applicable credit checks
Have the new property accepted
Meet loan-to-value requirements
Complete the transactions within the lender's applicable rules
Your personal circumstances may also have changed since the original mortgage was arranged.
Portability shouldn't therefore be treated as guaranteed approval.
Why Would I Consider Porting?
One reason can be that your existing mortgage product remains attractive compared with the alternatives available when you move.
You may also have an Early Repayment Charge attached to the existing mortgage.
Porting could potentially allow you to retain an existing product, subject to lender terms, rather than simply repaying it and arranging an entirely new mortgage.
But whether this makes financial sense depends on the complete transaction.
What If I Need a Bigger Mortgage?
This is common when moving to a more expensive property.
Suppose your existing mortgage balance is £150,000 but you need a total mortgage of £220,000 for the next property.
Subject to lender approval, you may potentially:
Port existing borrowing: £150,000
and arrange:
Additional borrowing: £70,000
The additional borrowing would normally be arranged using a product available from the lender at that time.
This can result in your mortgage being made up of more than one part.
Why Can a Ported Mortgage Have Different Interest Rates?
If you're porting an existing product and borrowing more money, the two parts may be on different mortgage products.
For example:
Mortgage Part 1
Existing mortgage product being ported.
Mortgage Part 2
Additional borrowing on a product available when you move.
The interest rates, fixed-rate end dates and Early Repayment Charges may therefore be different.
This is sometimes referred to as having different mortgage sub-accounts or mortgage parts.
Why Do Different Mortgage End Dates Matter?
Imagine the ported part of your mortgage has a fixed rate ending in two years, while the additional borrowing has a fixed rate ending in five years.
Your mortgage could then have different product end dates.
When the first part becomes available for review, the second part may still have Early Repayment Charges.
This can make future remortgaging more complicated.
It doesn't necessarily mean you shouldn't proceed, but the implications should be understood when choosing the additional borrowing product.
What If My Existing Mortgage Rate Is Lower Than Current Rates?
Porting may be worth investigating.
Retaining a lower existing fixed rate on some of the borrowing could potentially be valuable.
However, you shouldn't compare only that rate.
The overall transaction can involve:
Existing mortgage rate
Additional borrowing rate
Product fees
Early Repayment Charges
Mortgage term
Monthly payments
Future product end dates
The complete mortgage structure should therefore be considered.
What Is an Early Repayment Charge?
An Early Repayment Charge, commonly abbreviated to ERC, is a charge that can apply when a mortgage is repaid during a specified period.
Fixed-rate mortgages commonly have ERC periods, although mortgage terms vary.
When you sell your home, your existing mortgage is normally repaid.
This can potentially trigger an ERC.
If you're porting, the lender's rules may provide for the charge to be avoided, refunded or otherwise treated according to the terms of the mortgage and timing of the transactions.
Always check the specific lender's rules.
What If I Don't Want to Port?
You don't necessarily have to port simply because your mortgage is portable.
Another lender might offer an alternative that better fits your circumstances.
However, if leaving your existing mortgage creates an Early Repayment Charge, this cost needs to be considered.
The comparison should therefore look at the overall cost of:
Porting and staying with the existing lender
versus
Repaying the existing mortgage and arranging a new mortgage elsewhere.
What Is Equity?
Equity is broadly the difference between the value of your property and the amount secured against it.
For example:
Property sale price: £300,000
Outstanding mortgage: £180,000
Gross equity: £120,000
However, £120,000 wouldn't necessarily be the amount available to use as your next deposit.
Other costs may need to be deducted.
How Much Equity Will I Actually Have?
Your available equity may be affected by costs such as:
Estate-agent fees
Solicitor fees
Early Repayment Charges
Other secured borrowing
Sale-related costs
So if you're planning to use the equity from your existing home as the deposit for the next property, establish the likely net equity, not simply the difference between property value and mortgage balance.
How Does My Equity Become the Deposit?
If your sale and purchase complete together, your solicitor normally coordinates the movement of funds.
Money from the sale is used to repay the existing mortgage and relevant transaction costs.
The remaining equity can then contribute towards the purchase of your new home.
You don't normally need the entire equity sitting in your personal bank account beforehand where the transactions are being completed together.
Your solicitor manages the legal movement of funds.
What If My Deposit Is Tied Up in My Current House?
This is normal for many home movers.
Your deposit for the next property may largely consist of equity that will only become available when your current home is sold.
This is one reason the sale and purchase transactions need to be coordinated carefully.
Your solicitor, estate agent, mortgage adviser and other parties can all have important roles in keeping the transaction progressing.
Should I Sell Before I Start Looking?
There isn't one answer that works for everyone.
You may want to understand your likely mortgage affordability and property budget before putting your home on the market.
However, a seller may view an offer differently depending on whether your own property is already:
Not yet marketed
On the market
Under offer
Sold subject to contract
Proceedable
The practical position of your sale can therefore influence the purchase process.
Should I Get a Mortgage Assessment Before Putting My House on the Market?
It can be useful.
Before making significant decisions, establish:
Approximate current property value
Existing mortgage balance
Early Repayment Charges
Whether the existing product is portable
Approximate available equity
Potential mortgage affordability
Likely purchase budget
This can help you understand whether your planned move appears financially realistic.
How Do I Calculate My Moving Budget?
A simplified starting point is:
Expected sale price
minus
Existing mortgage
minus
Sale and moving costs
equals approximately:
Available equity
You can then consider this alongside the amount you're potentially able and comfortable to borrow.
But don't forget the costs associated with the new purchase.
What Costs Should a Home Mover Consider?
Depending on your circumstances, costs can include:
Estate-agent fees
Solicitor or conveyancer fees
Survey costs
Mortgage fees
Valuation fees where applicable
Early Repayment Charges
Removal costs
Tax applicable to the purchase
Insurance
Initial repairs or improvements
Build these costs into your plans rather than assuming all of your equity can become the next deposit.
Will I Need Another Affordability Assessment?
Yes, if you're applying for a mortgage on your next home, the lender will assess the application according to its requirements.
This applies even if you're porting an existing mortgage product.
Your circumstances may have changed since you originally borrowed.
For example:
Income may have changed
Employment may have changed
You may now have children
Childcare costs may have changed
You may have new loans
You may have car finance
You may have become self-employed
Your mortgage term may need changing
The lender needs to assess the new application based on the relevant circumstances.
Can I Port If My Income Has Fallen?
Potentially, but portability doesn't override affordability requirements.
If your income has reduced since your original mortgage was arranged, the lender will consider whether the proposed mortgage remains affordable under its criteria.
This is particularly important if you're also asking for additional borrowing.
Review affordability before becoming committed to the new property.
Can I Port If I've Become Self-Employed?
Potentially.
However, the lender will assess your current employment and income position according to its criteria.
Someone who originally obtained their mortgage while employed but has since become self-employed may now need different evidence.
Our Self-Employed Mortgage Guide explains how mortgage lenders can assess business owners, directors and contractors.
Can I Port to a Cheaper Property?
Potentially.
However, if you're moving to a cheaper property and therefore need a smaller mortgage, part of the existing borrowing may need to be repaid.
This can have implications for any Early Repayment Charge.
The lender's porting rules and the amount being transferred should therefore be checked before proceeding.
What If I'm Downsizing?
Downsizing can reduce the amount of mortgage required or potentially remove the need for a mortgage altogether.
But if your existing mortgage is still within an Early Repayment Charge period, selling and repaying it could create a charge.
Check this before assuming all of the equity released through downsizing will be immediately available.
Can I Change the Mortgage Term When Porting?
Potentially, subject to lender criteria.
For example, you may want to:
Keep the existing remaining term
Reduce the term
Extend the term
Changing the term can affect monthly repayments and total interest.
Extending the term may reduce the monthly payment, but borrowing for longer can increase the overall amount of interest paid.
What Happens If My Sale and Purchase Complete on the Same Day?
This is a common home-moving structure.
Your solicitor coordinates the sale of your current property and purchase of the new one.
Broadly, the process involves:
Your existing property completes.
Your existing mortgage is repaid.
Available equity contributes towards the new purchase.
New mortgage funds are used towards the new property.
Your new purchase completes.
The exact legal and financial mechanics are handled by your conveyancer.
What Is a Property Chain?
A property chain occurs when several transactions depend on one another.
For example:
Your buyer may need to sell their property.
You need to sell yours before buying another.
Your seller may also be purchasing somewhere else.
This creates a chain of connected transactions.
If one transaction is delayed, others can potentially be affected.
Why Can Property Chains Take Time?
Many different stages need to come together.
These can include:
Mortgage applications
Property valuations
Surveys
Searches
Legal enquiries
Title investigations
Leasehold information
Mortgage offers
Sale negotiations
Other buyers and sellers
Your mortgage offer can therefore be only one part of the overall home-moving process.
What Is Exchange of Contracts?
In England and Wales, exchange of contracts is the point at which the sale and purchase normally become legally binding, subject to the contractual terms.
Before exchange, your solicitor will want the relevant legal and financial arrangements to be ready.
This can include having an acceptable mortgage offer where you're relying on mortgage finance.
Don't commit to an exchange date without your solicitor confirming that they are ready to proceed.
What Is Completion?
Completion is when the purchase funds are transferred through the legal process and ownership of the property changes.
This is normally when you receive access to your new home.
If you're selling and buying simultaneously, your solicitor coordinates the funds between the transactions.
What Happens If the Sale and Purchase Don't Complete Together?
This can become particularly important where you're porting a mortgage.
Some lenders may have provisions for situations where the existing property is sold before the replacement property completes, potentially involving specific time limits or treatment of an Early Repayment Charge.
Rules vary between lenders.
Never assume that you can sell today and port the mortgage at any point in the future.
Check the lender's requirements before arranging the transactions separately.
Can I Own Both Properties Temporarily?
Potentially, but this changes the mortgage and financial position significantly.
You may need to consider:
Affordability
Deposit
Existing mortgage
Additional property taxation
Whether temporary finance is required
Insurance
Legal implications
Buying before selling shouldn't be assumed to work simply because you have substantial equity in your current property.
Professional mortgage, legal and tax advice may be required.
What Is Bridging Finance?
Bridging finance is a form of short-term finance that can sometimes be used in property transactions.
For example, it may be considered in certain situations where there is a timing gap between transactions.
However, bridging finance can be more expensive than conventional residential mortgage borrowing and involves specific risks, fees and repayment requirements.
A clear and credible repayment or exit strategy is normally fundamental.
It shouldn't be entered into simply to make a difficult property chain more convenient without understanding the costs and risks.
What If the New Property Is Unusual?
Even if the lender is happy with you financially, it must also be satisfied with the property being offered as security.
Potentially relevant property characteristics can include:
Construction type
Condition
Lease length
Flats above commercial premises
Listed status
Significant acreage
Restrictive covenants
Certain planning issues
Unusual occupancy arrangements
If you're considering an unusual property, send the details to your mortgage adviser early.
Should I Arrange a Survey?
A lender's mortgage valuation is primarily for the lender's purposes.
It isn't necessarily a detailed survey of the property's condition.
Depending on the property, you may want to consider obtaining your own appropriate survey.
This can help identify issues that may affect your decision to proceed or the amount you're willing to pay.
What If My Current Mortgage Is With a Great Lender but the New Property Doesn't Fit Its Criteria?
This is one of the limitations of porting.
You and your finances might meet the lender's requirements, but the new property also needs to be acceptable.
If it isn't, retaining the existing mortgage product may not be possible.
Alternative mortgage options may then need to be considered.
Should I Port or Take a New Mortgage?
There isn't a universal answer.
A proper comparison may need to consider:
Existing interest rate
Remaining fixed period
Early Repayment Charge
Additional borrowing required
New mortgage products
Product fees
Monthly payments
Mortgage term
Future product end dates
Property criteria
Affordability
Future plans
Porting can sometimes be attractive.
In other circumstances, arranging a completely new mortgage may be more appropriate.
The important point is to compare both routes rather than assuming one is automatically better.
What Should I Avoid While Moving Home?
Once your mortgage position has been assessed, try to avoid unnecessary changes to your finances before completion.
Be particularly cautious about:
New car finance
Personal loans
New credit cards
Large Buy Now Pay Later purchases
Increasing existing debts
Missing payments
Changing employment without considering the mortgage implications
Spending money allocated to your deposit and costs
If your circumstances change, tell your mortgage adviser.
Moving Home Checklist
Before putting your property on the market:
☐ Check your existing mortgage balance
☐ Check your current interest rate
☐ Check when your mortgage deal ends
☐ Check any Early Repayment Charge
☐ Establish whether your mortgage is portable
☐ Obtain an approximate property valuation
☐ Estimate your available equity
☐ Consider selling costs
☐ Review your mortgage affordability
☐ Establish an approximate purchase budget
Once your property is on the market:
☐ Keep your mortgage adviser updated
☐ Prepare your mortgage documents
☐ Review potential properties carefully
☐ Check unusual properties before offering
☐ Consider an Agreement in Principle where appropriate
Once you have an accepted offer:
☐ Confirm the purchase price
☐ Confirm the property address
☐ Update your mortgage adviser
☐ Instruct a solicitor or conveyancer
☐ Confirm the mortgage strategy
☐ Submit the mortgage application
☐ Arrange an appropriate survey if required
☐ Keep your estate agent, solicitor and adviser updated
Before exchange:
☐ Ensure the mortgage offer is in place
☐ Review the legal position with your solicitor
☐ Arrange appropriate buildings insurance where required
☐ Confirm deposit arrangements
☐ Confirm the completion plan
☐ Avoid unnecessary new borrowing
Timing Matters When Moving Home
A home-mover mortgage isn't happening in isolation.
Your mortgage application is connected to:
Your sale
Your buyer
Your purchase
Your seller
Solicitors
Estate agents
Mortgage lenders
Surveyors
The timing of these different elements can change.
For this reason, communication throughout the transaction is particularly important.
Start With the Mortgage Before Committing to the Move
If you're considering moving home, one of the most useful early steps is understanding the mortgage you already have.
Find out:
What do I owe?
When does my current deal end?
What Early Repayment Charges apply?
Can the product potentially be ported?
How much equity might I have?
How much could I potentially borrow for the next property?
Only then can you start building a realistic purchase budget.
How Cambs Ely Mortgages Can Help
Cambs Ely Mortgages can help you review your existing mortgage and understand the potential options before you move.
We can look at your current mortgage, Early Repayment Charges, portability, available equity, additional borrowing requirements and affordability before considering the mortgage options for your next home.
If porting is potentially appropriate, we can also consider how the existing mortgage and any additional borrowing could work together.
We help home movers in Ely, Cambridge, Cambridgeshire, East Anglia and across England, with appointments available remotely.
Building Blocks for a Brighter Future.
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Important Information
This guide provides general information and shouldn't be treated as personalised mortgage, bridging, financial, legal or tax advice.
Mortgage portability is subject to the existing lender's terms, affordability assessment, lending criteria and acceptance of the new property. A portable mortgage product doesn't guarantee that a new mortgage application will be approved.
Early Repayment Charges and other costs may apply.
Your home may be repossessed if you do not keep up repayments on your mortgage.