Mortgages
Notes #
Rates for mortgages generally improve as you go up each 5% on your loan-to-value ratio.
Fixed Rate #
Fixed for a specific amount of time at a certain percentage. e.g. 5 years at 2.5%.
Tracker #
Rate is tracked against the Bank of England base rate so it can fluctuate depending on that rate.
Overpayments #
Overpaying, even a small amount each month, can knock years off the length of a mortgage. Money Saving Expert's mortage overpayment calculator is great for working this out.
Porting Mortgages #
Essentially, "Porting" a mortgage means "keep this mortgage but link it to a different house". If you port when buying a house that costs more, you have to get a second mortgage for the rest. Example (without any deposits/equity for simplicity):
- House 1 has a mortgage of £100k
- House 2 costs £150k
- To port to house 2, you would keep the 100k mortgage then get another mortgage for £50k
Keep in mind if the either mortgage is on a fixed rate term, that it can be difficult to remortgage back into one mortgage again so it's worth considering putting the second one on a tracker until the fixed term is finished on the first.
I don't know how it works if house 2 is cheaper than house 1.