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Moving mortgage to another house - lose tracker?

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  • 09-07-2011 1:23am
    #1
    Moyglish
    Registered Users Posts: 726 ✭✭✭


    Hi guys!

    Posting on behalf of a family member..

    Person owns 2 homes on the same street. One is their main residence, the other is rented.

    They decided to sell their rented home which is currently on a tracker mortgage.

    The house is sale agreed and contracts should be signed and monies exchanged within the next month.

    They have no mortgage on their main residence.

    They would like to transfer the tracker mortgage on the home they are selling to their current main residence. It's a small mortgage - less than 100k left.

    They are wondering if they transfer the mortgage will they lose out on their tracker? AFAIK they are with Permanent TSB.

    They would not be looking to top up the mortgage nor extend it - they would be paying the same amount monthly, just on a different house, they would not be altering any other terms.

    They reckon that if they were to lose their tracker that their mortgage repayments would shoot up over E200 per month.

    Is it possible to keep the tracker in this instance?

    Appreciate any replies, as I honestly haven't got a clue in this regard.


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    #2
    NIMAN
    Registered Users Posts: 33,607 ✭✭✭✭NIMAN


    simple answer - yes.

    Because technically you would not be able to move a mortgage. One is paid off, then another one started on a new property, and since banks don't offer trackers any more, you could not avail of it.

    Couple of other things, for such a small mortgage, can't see why it would jump up by as much as £200 each month.

    And not sure the bank will be mad about switching a mortgage over to a house which has no mortgage on it.

    And if House#2 is being sold, why would there still be a mortgage of €100k ? Would the profit not pay off the existing mortgage or most of it?


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    #3
    Moyglish
    Registered Users Posts: 726 ✭✭✭Moyglish


    Hi Niman,

    The couple involved have sat down and done their sums, and they seem adamant that if they lose their tracker rate that their repayments will shoot up E200 per month more than they are currently paying.

    The proceeds of the sale of the house will indeed more than cover the mortgage, thankfully, they are not in negative equity, however I understand that they are with PTSB and I think that they were hoping to hold off a few months / a year to see whether or not they would up their game when it came to the 10% bonus they are currently offering those who pay off a lump sum on their mortgage.

    They are quite happy paying the mortgage repayments at their current level and are happy to do so even after the house is sold. I think perhaps that they were planning to invest monies from proceeds of sale whilst keeping up their current mortgage commitments.


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    #4
    phormium
    Registered Users Posts: 3,340 ✭✭✭phormium


    They are missing the point, there is no question of their repayments going up as the mortgage will cease to exist when they sell the house. The only way you can 'switch' the mortgage is to take out a new mortgage on the house they are keeping and pay off the one on the house they are selling. This would be pointless as firstly they probably wouldnt get what is effectively an equity release and secondly it would be at normal mortgage rate.

    So the answer is no, there is no way they can keep that tracker mortgage and sell the house. Why not sell the one they are living in and move to the one with the tracker especially if they are both the same.


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