Home Mover
There are many reasons why people want to move home, whether it’s having more space, relocating for work, a change in relationship or downsizing once the kids have flown the nest.
Read on for our guide to moving home with a mortgage.
Your home/property may be repossessed if you do not keep up repayments on your mortgage.
Something to Consider
There are a few options to consider when you want to move house but have a mortgage already in place.
The first thing to check would be the current status of your mortgage – are you tied into an initial rate period? Are there any early repayment charges? Are you on the standard variable rate? Or able to port your mortgage?
Most fixed rate mortgages include early repayment charges. These are a penalty for paying the mortgage off early and getting out of the deal you agreed to when you took out the mortgage. The amount of the ERC usually decreases the closer you get to the end of your initial rate period. Once your initial rate period has come to an end, you are free to redeem that mortgage without paying any penalties.
If you are within your initial rate period and you want to move, there is still the option of porting your mortgage. This is when you keep your current mortgage but move it to the new house you want to buy. If you are moving to a more expensive property, you may need to top up your mortgage by taking out an additional new loan. So you can end up with two parts to your mortgage, on different rates or timescales running alongside each other.
We can help you work out if it’s best to pay off your existing mortgage (including any early repayment charges) and take out a new mortgage, or to port your current mortgage and top up if necessary. There are lots of factors to consider, and we can do the research for you and help you navigate this decision.
Do I need to list my home for sale before I can look for a new one?
Ideally, yes – the recommendation is to list your property for sale before you start looking for one you want to buy. Once you have accepted an offer on your property (found a buyer), it puts you in a stronger position as a buyer once you find a property that you want to make an offer on. It also gives you a much more realistic idea of how much equity you actually have and can therefore spend on the property you want to purchase.
What should I look for when choosing an estate agent to sell my property?
When choosing an estate agent to market your property, you should compare at least three local agencies on a few points.
- Ask them to value your property, and while they are there, ask what similar properties they have sold in your area recently. Ask what they were listed for and what they actually sold for. Also ask how long those properties were on the market before selling.
- Ask how they will market your property and what is included. Ask for examples of their current listings, check the photos, floor plans and descriptions. Are they on Rightmove and do they promote properties on social media? How good are they at chasing feedback from viewings and negotiating offers?
- Compare the agencies’ fees – ask for the total cost including VAT and any additional charges. Check if the fees are payable on exchange or completion and what happens if you decide to change to a new agent.
- Check they are regulated by the Property Ombudsman or Property Redress Scheme.
- Find out about the contract – is it sole agency, multiple agency, are there any tie-in periods, what happens if you find a buyer privately?
Don’t just choose the cheapest agency – consider all the factors above and decide who you think will market your property well and has the best chance of finding you a buyer.
How to make my house more sellable?
Make your home feel clean, spacious and well maintained to show it off in its best light to potential buyers.
A good declutter will make the world of difference to the appearance of your property. Clear surfaces and floors give the impression of space and photograph better than busier spaces.
Make a list of all the little jobs that need fixing – peeling paint, leaky taps, loose door handles, mould, etc. Walk around your house and try to see it as a potential buyer with fresh eyes; it’s so easy to miss those little snags that you walk past every day.
Give everything a deep clean and add some reed diffusers or air fresheners to make sure the place smells clean and fresh. Pay particular attention to the grout and shower screens in the bathroom, removing any limescale and ensuring kitchen surfaces are clear and appliances are sparkling.
When you have agents round to value your property, you can ask them what changes they would make before putting it on the market. You can discuss with them if there is anything else that needs doing or if it is worth spending a little more to achieve the best price.
Home Moving Process
We recommend you reach out to a mortgage adviser when you first consider moving house. We are always happy to help and have the knowledge and experience to take the stress and guesswork out of the process for you.
However, if you are the type of person who likes to do your own research or have a deeper understanding, then read on to discover what happens when you want to move home if you already have a mortgage. (The following assumes you are moving to a property of equal or higher value than where you are now and that you already have a mortgage on your current property.)
The first thing to do would be to ask for a redemption statement from your current lender. This will set out exactly how much it would cost for you to pay back your mortgage on the date that statement is produced. It would detail how much the early repayment charge would be (if any) and the outstanding balance of your mortgage plus any other fees that are owed.
If you are tied into an initial rate period, you need to know the expiry date of the initial period and when the early repayment charges no longer apply. If you are in the middle of your initial rate period and early repayment charges are unavoidable, then you would find out from your lender if porting is an option for you and what the criteria/implications of porting your mortgage would be. Just because your mortgage is portable, it doesn’t automatically mean you can do it – the lender will reassess your circumstances at the time and let you know how much you can port and how much more you can borrow if you need to.
Next, contact a few local estate agencies and get them round to give you a valuation. It is good to use local agents as they have the knowledge and experience of selling homes in your specific area, so they should be able to give you an accurate guide price to list your property at. Take the average or the lower figure and use this as a guide to figure out how much equity you may have in your property. (The likely selling price minus the amount on your redemption statement will give you an estimate of the equity you have).
Most people use some or all of the equity as the deposit (or part of the deposit) for their next purchase. When moving, a 5% deposit is generally the lowest you need for the property, but as always, if you have a higher deposit, you could benefit from having products with better interest rates available to you.
With this in mind, the next step would be to work out your affordability. Using your income and outgoings and taking into account any credit commitments and financial dependants (either children or adults), we can figure out how much you can afford to repay each month.
After that, we would look to get an agreement in principle (also known as a mortgage in principle or decision in principle). This would be from a lender stating how much they would potentially lend you based on your circumstances and the information provided.
It’s really important to consider the other costs associated with moving house. Estate agents will charge a fee for selling your property. Stamp duty tax will be payable on your new purchase, and there will be solicitor’s fees involved for the selling of your old property and the purchase of your new one. And don’t forget removal firms/van hire, cleaning and any new furniture or repair works needed to make your new home habitable. It all adds up.
Once you have worked out the true cost of moving and your potential purchase price, then you can decide if moving is financially viable and a real possibility for you.
If yes, then finally you can start checking online sites like Rightmove and Zoopla and register your interest with local estate agencies in the area you want to purchase in for your dream property.
The first thing to do would be to ask for a redemption statement from your current lender. This will set out exactly how much it would cost for you to pay back your mortgage on the date that statement is produced. It would detail how much the early repayment charge would be (if any) and the outstanding balance of your mortgage plus any other fees that are owed.
If you are tied into an initial rate period, you need to know the expiry date of the initial period and when the early repayment charges no longer apply. If you are in the middle of your initial rate period and early repayment charges are unavoidable, then you would find out from your lender if porting is an option for you and what the criteria/implications of porting your mortgage would be. Just because your mortgage is portable, it doesn’t automatically mean you can do it – the lender will reassess your circumstances at the time and let you know how much you can port and how much more you can borrow if you need to.
Next, contact a few local estate agencies and get them round to give you a valuation. It is good to use local agents as they have the knowledge and experience of selling homes in your specific area, so they should be able to give you an accurate guide price to list your property at. Take the average or the lower figure and use this as a guide to figure out how much equity you may have in your property. (The likely selling price minus the amount on your redemption statement will give you an estimate of the equity you have).
Most people use some or all of the equity as the deposit (or part of the deposit) for their next purchase. When moving, a 5% deposit is generally the lowest you need for the property, but as always, if you have a higher deposit, you could benefit from having products with better interest rates available to you.
With this in mind, the next step would be to work out your affordability. Using your income and outgoings and taking into account any credit commitments and financial dependants (either children or adults) we can figure out how much you can afford to repay each month.
After that, we would look to get an agreement in principle (also known as a mortgage in principle or decision in principle). This would be from a lender stating how much they would potentially lend you based on your circumstances and the information provided.
It’s really important to consider the other costs associated with moving house. Estate agents will charge a fee for selling your property. Stamp duty tax will be payable on your new purchase, and there will be solicitor’s fees involved for the selling of your old property and the purchase of your new one. And don’t forget removal firms/van hire, cleaning and any new furniture or repair works needed to make your new home habitable. It all adds up.
Once you have worked out the true cost of moving and your potential purchase price, then you can decide if moving is financially viable and a real possibility for you.
If yes, then finally you can start checking online sites like Rightmove and Zoopla and register your interest with local estate agencies in the area you want to purchase in for your dream property.
