If you’re an existing Santander mortgage customer looking to move home , you may be wondering what your mortgage options are. Can you take your mortgage to the new property with you and if so is it the right thing to do? Ultimately there are several factors and considerations, this guide will break down your options.
Can I move my Santander mortgage to a new property?
Most Santander mortgages are portable, subject to affordability and criteria being met. It’s important to check the terms of your mortgage, which can usually be found either on your original mortgage offer or by contacting them directly. While the mortgage itself may be portable, it’s important to understand that this does not guarantee acceptance. The application is subject to underwriting, and the process is very similar to any other non-porting application.
What are your mortgage options when moving home?
There are several scenarios you may consider when moving home, and the best option for you will depend on your own circumstances and preferences:
– Stay with the same lender: This option may allow you to avoid exit fees if you’re moving midway through a fixed-rate term.
– Stay with the same lender and borrow the same amount.
– Stay with the same lender and borrow more: This is subject to affordability and criteria. The additional borrowing will usually be on a different rate than the existing ported mortgage.
– Stay with the same lender and borrow less.
– Switch to a new lender: This may involve an exit fee if you’re midway through a fixed-rate term.
– Change the length and repayment type of the mortgage: It’s sometimes possible to adjust the length or repayment set of your mortgage term when porting a Santander mortgage. For example, if you are significantly increasing your borrowing, you may want a longer term to accommodate, or vice versa when taking a smaller mortgage.
Benefits of Santander porting
Your points are well articulated, but here’s a refined version for clarity and coherence:
There are potentially numerous benefits to porting a mortgage with Santander:
– Saving money on exit fees: For instance, if you’re tied into a £200,000 mortgage with a 5% Early Repayment Charge (ERC), redeeming your mortgage to move to another lender could incur a fee of £10,000. Porting your mortgage may help you avoid this expense.
– Saving money on rates: If rates have increased or less attractive options are available, porting your mortgage can be advantageous. For example, if you secured a rate at 2% on your current mortgage and the rate when you look to move is 4%, porting may allow you to continue enjoying your lower rate for the remainder of the product term.
– Potentially easier process: As the lender has a history with you and your information, the porting process may be smoother and quicker compared to starting afresh with a new lender.
Drawbacks to porting
There can be some potential drawbacks to porting:
– Limitations with current lender: Your current lender may not offer the terms you require. Other lenders may provide higher borrowing amounts or offer more favorable terms, such as longer mortgage terms, cheaper rates, or more suitable products like offset or tracker mortgages, which your current lender may not offer. The mortgage you originally took may have been suitable then but may not meet your needs now.
– Rate comparison: It’s important to compare the trade-off between potentially saving on Early Repayment Charges (ERCs) with any difference in interest rates.
– Multiple sub-accounts: If you borrow additionally, the additional borrowing will be placed on a separate sub-account. While not necessarily a problem, having multiple sections to your mortgage can create issues when remortgaging because the fixed-rate end dates may not align. For example, your existing mortgage may end on June 30, 2027, but your top-up borrowing may have a fixed interest rate until September 2027.
What is the Santander mortgage porting process?
The process for porting your mortgage with Santander is similar to any other mortgage application, but with a few nuances:
1. Consult a mortgage broker: They will calculate the equity in your existing property, consider any additional funds needed for the move, factor in associated costs, and determine the mortgage amount required. They will then assess both porting options with Santander and offerings from other lenders to find the best fit for you.
2. Agreement in principle (AIP): Contrary to popular opinion, an AIP is still required for a Santander porting application. This confirms the amount you can borrow and strengthens your negotiation position when making an offer.
3. Property search and offer acceptance: Once you find a property and your offer is accepted, you can submit the mortgage application.
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4. Underwriting: The mortgage application undergoes underwriting, where Santander assesses your financial situation and the property’s suitability for the loan.
How can Strive help?
While it’s possible to port your mortgage with either a broker or directly through Santander, working with a broker offers several advantages. A broker provides a more holistic view, reviewing all lender options rather than focusing solely on Santander.
Additionally, brokers may have access to exclusive rates that cannot be secured directly. Furthermore, the process may be more streamlined through a broker, potentially resulting in shorter wait times compared to dealing with banks directly.
At Strive, we have vast experience assisting homeowners with moving home and have arranged thousands of Santander mortgages for our clients.
FAQ’s
Are there fees to port a mortgage?
It depends. If you’re borrowing additionally, there may be product fees, and there could be valuation fees, but no fees specifically for porting.
Can I be declined when porting my Santander mortgage?
Yes, the underwriting process is very similar to any other application, and you could be refused if you do not meet affordability or criteria.
What are Santander porting rates?
The porting element will be the same as your current product, and the additional borrowing will be based on the prevailing rates on the day of application. Typically, 2, 3, and 5-year fixed rates are offered, as well as 2-year trackers.
Is it cheaper to port a mortgage?
It depends on the terms available to you. If rates have increased since you took out the original mortgage you intend to port, then potentially.
Can I transfer my Santander mortgage to a new property?
Yes, subject to criteria, affordability, and credit checks, assuming your product is portable.
Do I need good credit to transfer my mortgage?
A credit check will be conducted. Santander usually insists on reasonable credit. If you are not increasing your borrowing or loan-to-value, they may be more lenient.
Contact us today, and we’ll work hard on your behalf to find you a competitive mortgage.
For more information on mortgages for contractors, please contact a member of the Strive team, by emailing [email protected] or call us on 01273 002697.
