The Mortgage Hut Guide to Moving House

The lender will run a new round of affordability checks and you may find that your current financial position is not quite as strong as it was when you first obtained the mortgage. This is especially true if you are looking to up the size of your mortgage to cover the value of the new home.

Even if your mortgage lender still considers you a viable option for the mortgage, deals and terms may have changed in the interim, and you could find yourself on a different rate of interest than you are currently.

All in all, though the mortgage port might seem easier (especially as it will come with fewer fees), it may end up being a more expensive option. Talking to our experts at The Mortgage Hut will help as we can breakdown the deals on offer and make a complete comparison for a better overall picture.

When you first bought your home, you had to save for years to put together your deposit, but the second time around the equity from your first home will represent your deposit for your second.
Your equity is the value of your home once the mortgage secured on it is fully paid off – hopefully this is a considerable amount which represents all the payments you have made as well as the rise in your property’s value over time.

For example:

Nothing can replace the advantage of experience. Working with us gives you access to the many decades of combined experience our team possess, but don’t discount your own experience from the first time around.

You doubtless understand more about the different types of mortgage product on offer, have a better idea on how to budget and understand your credit history to a far greater depth – all education that will help you get a new mortgage that really suits you.

Unfortunately, moving house in the UK isn’t cheap. National statistics quote the estimated cost of moving house (2018) as £8,885.66 so doing everything you can to minimise this expenditure is a good idea!

Depending on your mortgage deal, you may have to face early repayment charges. These fees are typical during the initial deal portion of your mortgage (for example, the first few years with a fixed interest rate) but may be in the terms of your current mortgage for many years. It is well worth finding out in advance if you will have to face early repayment fees by contacting your mortgage provider.

You can ask your current lender to provide a redemption statement for a breakdown of any early repayment fees that will be applied when you end the current mortgage.
Early repayment fees are typically 1% to 5% of the outstanding balance of the mortgage, so tend to represent thousands of pounds that you will have to factor in to your moving costs.

When you bought your first home as a first time buyer you would have been in receipt of a substantial stamp duty discount and may not have paid any duty at all. Unfortunately, this is not the case when you move house to a new home.

Stamp duty is a tax paid by the buyer of any property or land in the UK and is charged on all property valued at £125,000 and above. You pay 2% on the portion of the value from £125,001 to £250,000 and then 5% for the next £675,000 (with higher rates beyond that).

This means, for example, that a property valued at £275,000 will incur stamp duty of £3,750.

Note: There is a 3% surcharge on all SDLT if you own multiple properties. Under normal house moving circumstances, you sell your old house at the same time as buying the new one, so you don’t own two properties at once, but if there is a delay in selling your old home then you would have to pay the surcharge for owning two properties at once. On a £275,000 house this would be an additional £8,250 to pay! Thankfully, you can apply for a rebate of this amount once you sell your old house (as long as it is within 36 months). [This note might benefit from a box out, and a break in the paragraphs if you do so.]

Just as when you first got a mortgage, the solicitors are needed to get involved for moving house. Due the the delicate timing of any chain (discussed later in this guide), solicitors can be more important (and more expensive) when moving to a new home than they were for your first mortgage. Effectively you are using your solicitors twice as much – once to buy a house and once to sell one.

Remember that the first estate agent you visit doesn’t have to be the one you stick with! Shop around and find an agent who you feel comfortable with. You are trusting them to sell on your largest asset and that won’t work to its fullest if there’s even a slight personality clash.

Discuss their fees early on and compare them to other quotes so that you know what your move is going to cost and get multiple valuations before determining the price to put your house on the market.

Spend time with your estate agent showing them the highlights of your property. You’ve lived there for years, so you know what stands out as a selling point and the things that are promoting you to move. Let the estate agent hear your enthusiasm for those things you are going to miss as it will help them do their job.

There are plenty of online property advertising sites that can mean you can do the selling yourself and if you are an able sales person with a willingness to put the time and effort it to sell your house then there’s no problem with doing it yourself. Remember, however, that there are pitfalls to being an estate agent that you are likely to fall into and if you value your time highly then it might simply be more cost effective to get an agent to sell for you.

Agents can be expensive, with their services costed as a percentage of your sale price, and doing the selling yourself can save you thousands if you get it right, but ask yourself if you are going to be wiling to take an offer that strips away that saving to be rid of the stress and difficulty you have put yourself in – if the answer is ‘yes’, then you may be better off employing a professional to do it for you.