If you take out a new mortgage when you move home, the following fees may apply:
An arrangement fee is the cost charged by the lender for arranging the mortgage. It varies depending on the deal but can be around £1,000 or more.
The valuation fee is the cost the lender charges for valuing your new property to check the amount you're paying for it is what it's roughly worth. This fee is sometimes included as part of the mortgage deal.
Legal fees cover the cost of the solicitor that takes care of the legal paperwork for the mortgage. Sometimes legal fees are included as part of the mortgage deal.
If you're leaving your current mortgage before it's officially ended, you may face ERCs. These can amount to thousands of pounds so make sure to budget accordingly.
If you use a mortgage adviser to find your new deal, they may charge broker fees. But not all of them do (our broker partner Mojo doesn't) – and they should tell you from the outset if they do.
There's a lot of things to think about when you move home, including your mortgage. You may be able to take your existing one with you, but that isn't the only option. An experienced broker, like our Mojo experts, can look at all your options to find right mortgage for you.
If you port your existing mortgage to your new property, you should be able to keep your existing rate.
But you need to check your terms and conditions to confirm that the deal is portable.
And that there are no circumstances that mean the lender isn't happy for you to port or keep your existing rate.
If you're in negative equity, it's worth consulting your lender about your existing deal before you firm up any moving home plans.
Negative equity means you owe more on your mortgage than your property is worth. This normally occurs if house prices fall.
You'd likely struggle to get accepted for another mortgage for your new home if this is the case.
Your bank or building society is best placed to guide you through the options available to you.
If you're moving to a bigger or more expensive home and need a larger mortgage, you may be able to:
There are upsides and downsides to all options. Deciding on the best one for you depends on you and your circumstances.
Yes, if you're moving to a new home, you can use the equity in your existing home as a deposit.
For example, if your current property is valued at £200,000 and you have £50,000 (25%) equity, and you're moving to a £500,000 property, the equity in your existing property would amount to a 10% deposit.
You can also top up your deposit amount with savings. This may help you get access to a lower LTV deal which normally means you get better rates.
are a type of loan used to buy a property. The mortgage is secured against the value of the property.
are where you only pay back the interest each month. When your mortgage term comes to an end, you still owe exactly what you borrowed at the start.
aren't that different from a regular mortgage. But there are some important differences.
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Page last reviewed: 18 September 2023
Reviewed by: Claire Flynn
YOU SHOULD THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME/PROPERTY. YOUR HOME/PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.
The Financial Conduct Authority does not regulate mortgages for commercial or investment buy-to-let properties.
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