If you’re thinking of porting your mortgage, it’s essential that the process goes as smoothly as possible. To do this, keep tabs on finances, obtain a copy of your credit report, and speak to your mortgage broker for assistance.
Prior to porting your mortgage, it is essential that you verify if your new property meets the eligibility requirements and is suitable for porting. Non-standard construction properties (like timber or concrete framed) may make it more challenging to port your mortgage and les dette.
1. Keep an eye on your finances
When looking to port your mortgage, it’s essential that you keep an eye on your finances and have enough savings for the move. Doing this can give you peace of mind in case something unexpected occurs and prevent you from being able to make payments as scheduled.
One way to accomplish this is by saving regularly and diligently. Many banks, credit unions, and even credit card issuers offer free money-saving tools that can help track your spending patterns.
Another wise idea is to set aside regular monthly savings for a rainy day fund, as this can provide financial security during times of financial strain. This could include emergency situations such as an unexpected car repair or holiday that necessitates large sums of money.
It’s worthwhile to monitor your credit score and take steps to improve it if it isn’t as strong as it could be. Doing this gives you a better opportunity of getting the best rate on a new home loan.
It is ideal to keep your borrowing at or below 75% of the property value (LTV). Lenders may view this as a higher risk and require either an increased deposit or decline your application altogether.
If you’re in the market for a house but don’t have much cash saved up, consider paying off part of your old mortgage to reduce your LTV. Just be sure that there won’t be an early repayment charge (ERC) applied as a result.
You may opt to port your existing mortgage to a new one, which is similar to remortgage but with the added advantage that there are no Early Repayment Charges on your old deal. However, this option is only available if your current lender offers it and there is enough equity in your home to cover any associated costs.
Although it isn’t guaranteed, porting your mortgage could be beneficial for some people. It isn’t suitable for everyone though, so always seek professional advice before committing.
2. Get a copy of your credit report
Receiving a copy of your credit report is an essential step to take, as it will protect you against identity theft and notify you of any changes that could impact your credit rating.
Your credit report contains details about your personal history, such as identification information, payment history, and accounts opened by you. It also keeps a record of any inquiries made on it as well as public records like collections, repossessions, and foreclosures.
Lenders and other businesses rely on your credit report when making decisions about extending credit, providing loans and insurance, or renting you a home. It gives them an indication of how likely you are to pay your bills promptly.
Once a year, each of the three nationwide consumer reporting agencies — Equifax, TransUnion, and Experian — must provide you with your credit report free of charge. That’s why it’s recommended to check these reports frequently.
A credit report can help you stay organized and prepared for any financial emergencies such as bankruptcy or divorce. It also assists in spotting signs of fraud early, since it shows when someone has used your name to open new credit accounts in their name or if there are any late payments on your account.
To obtain a copy of your credit report, visit the website of the credit bureau that issued it. Alternatively, you may contact them directly to inquire.
The credit bureaus maintain files on millions of borrowers and purchase credit reports from lenders for use as references when creating loans. They then report this information to other creditors, insurers, and businesses as permitted by federal and state laws.
Your credit report can have a major influence on your ability to obtain loans, buy a car and even land a job. It will even affect your mortgage rate.
Porting your mortgage is a common practice that enables you to switch from one lender’s loan to another without having to go through the application and approval process again. While it’s not suitable for all homeowners, those with good financial credentials and who don’t mind paying a higher rate than usual may find porting beneficial.
3. Talk to your mortgage broker
Porting your mortgage can be a great way to escape an unfavorable deal and into one that offers more benefits. This process may be especially advantageous for people looking to upgrade from smaller houses to larger ones, but if your broker doesn’t follow through on promises made during the porting process, it could prove more complicated than anticipated.
Brokers can assist you in finding a home loan that meets both your requirements and budget. Typically, they have connections with multiple lenders which means they can secure you the most advantageous mortgage rate possible.
It’s wise to consult your broker about your current mortgage terms and conditions. Doing so can give you a clear insight into whether porting is beneficial, as well as any associated costs or fees.
Your mortgage broker can also suggest other deals you might qualify for, depending on your specific situation and circumstances. For example, if your credit history has improved and you’ve been self-employed for some time, they might be able to suggest a lender who will be more accommodating with debt repayments.
A great mortgage broker will have access to wholesale mortgage rates that are much lower than commercial banks with higher overhead costs. This is an invaluable advantage as it could save money on interest payments over time, especially if you plan to stay in your current home for an extended period.
When searching for a broker, make sure they offer you plenty of choices and are not solely focused on reselling loans to other clients. You may ask friends, family members, or experienced real estate agents for recommendations.
It is recommended that you interview brokers to observe how they communicate and relate to their clients. This can be an excellent way to assess if they are team players who will strive for you the best deal possible.
For first-time home buyers, working with a mortgage broker is often the best course of action as they can help you avoid common errors that could cause major financial difficulties in the future. For instance, if purchasing an unusual property that requires special approvals, they can direct you toward lenders offering more accommodating requirements. They may even suggest lenders specific to certain situations such as condos or properties needing renovation, etc.
4. Get your affairs in order
To guarantee a stress-free mortgage porting experience, it’s best to get your affairs in order beforehand. This includes getting a copy of your credit report, making regular payments on your current mortgage, and comparing the rates you currently pay with those offered by different lenders. Furthermore, make sure you’re on the most advantageous deal by reviewing existing contract terms and conditions for exit fees or other stipulations.
A smooth and efficient porting process can make for a less stressful life. Plus, you may be able to take advantage of the latest mortgage innovations such as no fees when porting your mortgage. As with most finances, getting it right the first time will save you money in the long run. For further advice and strategies tailored specifically to your situation, speak with your mortgage broker today for assistance.