Moving house mortgage query

[Cudd Wudd]

I am currently moving home having bought my first property 10 years ago. It is now sold (STC) and I am looking for a new home.

My current mortgage is with Nationwide at a rate of 2.5% (tracker). I have been overpaying the monthly sum by 100% and have the borrow back facility (which I understand was stopped in March 2010).

I need to borrow more for the front runner house I have seen, but Nationwide won't proceed with a decision in principle until I have borrowed back the overpayment facility, if I decide to do this. One advantage is I will then have additional funds to pay SDLT and use the balance to put towards the likely increased purchase price, but I am caught in two minds as to whether I should not borrow back and keep the overpayments in case I need them in the future.

Either way I am looking to port my existing mortgage and borrow the additional finance under a new deal, where the rate should be lower than the current one (if not 10 year fixed). However, moving forward with this is confusing me.

I am wondering whether I am best to look at alternative providers...but again don't know how best to approach this.

Having seen some very good advice on here over the years, I wonder whether anyone has some simple pointers for me. Am I best in talking to a mortgage broker away from Nationwide in the first instance?

Thank you in advance and sorry if any of the above doesn't make sense...this is all rather unchartered territory for me.

[Burgmeister]

I can't understand why they'd make you take the 'borrowback' before agreeing to a new deal.

Anyway, why not just use up your advance (your accumulated overpayments) by asking them to apply to the balance and then go for a new deal?

[Mortgage_tom]

Go see a mortgage advisor, they'll sort it out for you either way.

[paulrockliffe]

Burgmeister said:

I can't understand why they'd make you take the 'borrowback' before agreeing to a new deal.

I think it's because they don't like it, they're having to hold capital to cover the eventuality that the OP decides to take it out and spunk it. If they extend and leave the borrowback in place they'll effectively be extending the mortgage even further in terms of the capital they have to hold.

If you go with another lender what happens to the borrowback? Is it returned to you as cash and a higher mortgage value is settled, or is it extinguished to leave you with a lower mortgage redemption figure and loss of access to that capital? You should find out the answer to that as a priority, because if you're not getting the cash back then you would have to take the borrowback one way or another regardless.

It would then be a question of what mortgages are available to you if you throw the money in and if you don't as to whether it makes sense to lose access to that capital.

Either way, send Sarnie a PM and he'll sort you out.

[Cudd Wudd]

Many thanks for the replies, most appreciated. Sorry for the delay, things have been rather hectic but I didn't think it had been this long!

The above has been helpful, thank you.

As things stand, it seems very likely we will end up selling independently, as our sale seems quite far progressed and we haven't been able to find anywhere suitable. Even if something comes up now, I don't want to jeopardise our sale, so it is looking very much like moving our stuff into storage until something comes up.

That will be the overpayment conundrum sorted at least, even if my new dilemma will most likely be what to do with the equity over what could be a few months or considerably longer, but with a potential need for relatively quick access.

This buying and selling malarkey ain't that much fun!

Thank you for taking the time to reply, there are various posts and topics on here which give plenty of food for thought.