You’ve bought a property you thought would be your home for many years to come- but of course with life changes, this might not be the case for a whole host of reasons.
When getting a mortgage you are typically looking at a commitment of 15+ years, and over that period of time life can change drastically.
Sadly, we cannot tell you what will happen in this time period and if life changes then you may want to make a move to a new property that better meets your needs.
So the big question is- can I sell my property before my mortgage ends?
The simple answer is- yes….if you can afford to! Selling your property before the mortgage deal ends
Good news is that you can sell your property before your mortgage deal ends- but how.
The first thing you need to ensure is that the sale price of your mortgaged property is going to be greater than the mortgage amount you have left. This means if you owe £175,000 on your mortgage you would be looking to sell your property for more than this.
Another important factor to take into account would be any ERC, Early repayment charges, and fees such as using a mortgage broker are also covered.
A mortgage broker will help you look over the numbers, ensure this is a viable option for you and guide you through the process.
You will need to find out your mortgage documents, they will contain all the information you should need. This includes finding out your early repayment charges and if you are still in the period and will incur these. Additionally, this will show you your full and final mortgage settlement. This will be different if you are overpaying your mortgage, lenders tend to allow customers to overpay their mortgage by roughly 10% of the outstanding balance each year.
By using a mortgage broker, they will be able to guide you through this information and answer any questions you may have.
Financial penalties may be incurred; these typically would be between 3-5% of the total amount that is left to pay if you are still within the specific deal term.
Do I need to let my mortgage lender know?
You will need to inform your lender that you are selling, but this will only need to be done when you are 100% certain you are going to be selling your mortgaged property. By speaking to your lender they will be able to talk to you more about porting your mortgage if you choose to do so.
What is porting?
Want to move your existing mortgage to a new property- this is called porting. Most mortgages are portable and this means you can transfer your old deal over to your new home. This could be a positive option for you, depending on your current situation.
Sadly porting a mortgage is not as simple as it first may sound. You cannot simply change your address there is a lot more work that will go into assessing if this is an option for you.
Porting a mortgage will require a process similar to applying for a new mortgage or the process you’d go through if you were switching lenders. This will involve having your affordability assessed and reapplying before being accepted. Our advisors will be able to help you through this and do the hard work for you. If porting your mortgage is the most appropriate option for you, assessed by our experts, and you decide to go ahead with this route our advisors can ensure the process goes as smoothly as possible.
If you are accepted and all goes through you will be able to keep your existing deal, keeping all the terms. By doing this you are able to keep the same interest rate as you currently pay, this can be an option you are keen on particularly in the current financial climate that has seen interest rates on the rise.
Our advisors will talk you through your options after carrying out a detailed fact find and using this to speak to our panel of lenders and finding the most appropriate deal for you and your personal situation. Using a mortgage broker ensures you have an expert to talk you through your options and provide you the support you need to have one less worry for you.
What happens to my mortgage when I sell my property?
When you sell your mortgaged property, the money received from this will go to pay off the loan and any outstanding repayment charges that you may have incurred through selling. This will be done by your conveyancer ( solicitor) requesting a redemption statement from your mortgage provider and they will deal with the settlement on your behalf. By doing this your mortgage deal will come to an end. You will be mortgage free and can continue mortgage free or if you choose to get another mortgage you can go down the route of doing this.
For our mortgage advice services, we will charge a fee of between £395 and £995. For standard residential purchases or remortgages the fee will be up to £395, for standard But To Let purchases and remortgages the fee will be up to £495, for mortgages utilising a scheme including Right To Buy, Help To Buy, Shared Ownership, Joint Borrower Sole Proprietor or other schemes, the fee will be up to £595, for more specialist advice such as Limited Company Buy To Let Mortgages, Portfolio Landlord Mortgages (over 4 rental properties), Adverse Credit (missed payment or worse within the last 6 years) and Bridging Finance the fee would be up to £795 and finally for self-build and debt consolidation the fee will be up to £995.
The fee is payable on offer. You will not receive a refund if your mortgage or loan does not go ahead.
Whatever your dream is, our team is here to help you achieve it. Do not hesitate to contact us today
IMPARTIAL FINANCIAL ADVICE
Whether you’re a first-time buyer or a seasoned property developer our team will find you the very best deal.
Our experienced financial, insurance and mortgage advisors take real pride in offering impartial advice, so you’ll have the peace of mind that your best interests are at the heart of everything we do.
Based in Bath, we enjoy getting to know our clients and listening to their requirements we provide the right financial solutions every time.
