New mortgage deal before house move

[aussieal]

My Current fixed rate deal (2.39% with NatWest) comes to an end in December, so I have been looking at securing a new deal and have spoken to Santander about a 2 year fixed deal at 1.39%.

That in itself is a no-brainer, however we are planning on moving house in the first half of 2018 and will need to borrow more to do this. Santander have confirmed that the new deal will be portable to a new property and the rate will continue for that element of the mortgage.

What I'm trying to figure out is whether I should:

1. Secure this chunk of borrowing (~£100k) at the low rate of 1.39% now and then add the additional borrowing (likely to be ~£200k to £250k) to it with Santander; or

2. Take the initial hit of the SVR when my current deal lapses so I'm not restricted to one lender for the new mortgage (Santander has a ERC of 3%), whilst being conscious that rates are likely to only be going up.

Would appreciate any thoughts or lessons learned from similar experiences.

Cheers

[Sarnie]

£250k on a further advance rate isn't a great idea............

Also, you can't actually make this calculation until you apply for the further advance and you know the rate......

Additionally, what if Santander have an issue with any part of your application to port the mortgage (property, income, credit score, LTV, change in lending criteria).........

[aussieal]

That's confirmed what I was thinking, be great to secure the existing £100k at the low rate, but not at the expense of finding that it hampers the move in the not too distant future.

[Sarnie]

aussieal said:

That's confirmed what I was thinking, be great to secure the existing £100k at the low rate, but not at the expense of finding that it hampers the move in the not too distant future.

The key is what the blended rate would be Vs whats available from a provider to cover the full balance.

Poor further advance rates is one of the downsides of porting a mortgage.....

[RichS]

Also don't forget that two years after you've borrowed the £100,000 it'll roll off the reduced rate onto SVR and you probably will have to wait a few months (or more) before you can remortgage the lot, or else pay an ERC on the larger amount to repay it back earlier.

I think this is how it works Sarnie?

I have the "main" mortgage with HSBC and then a home improvement loan with HSBC as well, which I took out a few months later. I can either let the main mortgage go to SVR for a few months- not ideal- or break the home improvement loan by remortgaging the lot, and sucking up the ERC. I assume I won't be able to remortgage "just" the main loan when it rolls off, if the home improvement loan is still in place? Sorry for thread hijack.

[RichS]

Bumping in case anyone has an insight into my question- thanks. I could of course just call HSBC.