Porting

Porting is paying off an existing mortgage and taking out a new one with the same terms on a new property. This allows your client to keep their current interest rate and related product features.

Important things to know

Porting applications are a little different to our other applications.

Make porting applications through TMW Online.
We assess the application and affordability for porting on a Full Mortgage Application (FMA). TMW Online will not produce a Decision in Principle (DIP) for porting.
If you need a Mortgage Illustration for porting, you can request one using our Manual Mortgage Illustration Request Form (PDF, 192 KB).
For Limited Company porting, you can get a Mortgage Illustration from your sourcing system.
The new mortgage must complete at the same time as the existing one.

Eligibility

The mortgage product can port to another property in your client's buy to let portfolio, or to a new buy to let property.
The mortgage product cannot port to a property your client or an immediate family member is currently living in.
The property must be in a lettable condition.
Free legal fees, cashback, and free valuation features are not portable.

Types of porting

Additional borrowing

When porting, your client can borrow more than the outstanding amount on the mortgage they are redeeming. However, the ported interest rate doesn't apply to the full amount they are borrowing. It will only apply up to their original loan to value (LTV) or loan amount, whichever is lower.

For any borrowing above that amount, your client will need to choose a new product from our latest guide. They will also need to pay the new product’s fees. The maximum LTV on the overall loan across both products is based on the LTV limit of the new product.

Your client won’t have to pay ERCs when they port the full balance of their existing mortgage to a new property.

Additional borrowing is subject to criteria including:

How to work out maximum additional borrowing This will reveal additional content

There are three steps and you will need a calculator.

Step one – calculate minimum income required

You will need:

the current balance of the mortgage product that your client wants to port
our stress rates
the ICR relevant to your client

Current mortgage balance x Stress rate x ICR = Minimum rental income required

Step two – calculate spare rent

You will need:

the annual rental income of the property your client wants to port their mortgage to
Minimum rental income required from step one

Annual rental income - Minimum rental income required = Spare rent

Step three – calculate maximum additional borrowing

You will need:

spare rent from step two
our stress rates
the ICR relevant to your client

Spare rent ÷ Stress rate ÷ ICR = Maximum additional borrowing

Example:

Current mortgage balance £100,000 x stress rate 4.5% x ICR 125% = Minimum rental income required £5,625

Annual rental income £10,000 - Minimum rental income required £5,625 = Spare rent £4,375

Spare rent £4,375 ÷ stress rate 4.5% ÷ ICR 125% = Maximum additional borrowing £77,777.78

If your client is adding the product fee for the additional borrowing to the loan amount, you will need to take this into account and reduce the maximum additional borrowing amount in the calculations above.
If the stress rate on the additional borrowing product is higher than the stress rate on the ported mortgage, we will use the higher stress rate for both parts of the loan.
The stress rate used for the ported mortgage will be based on the amount of time remaining on the original product.

Information:

The above calculations are provided for illustrative purposes only and the mortgage application will be subject to underwriting.

Like for like porting

If your client is porting the total outstanding amount of the original mortgage product with us, this is a like-for-like port. Your client can keep their original product LTV, up to 80%.

For example, if your client owes £100,000 on the existing property, they must borrow £100,000 on the new mortgage product for the new property to be considered like for like.

Your client won’t have to pay ERCs when they port the full balance of their existing mortgage to a new property.

Part redemption

If your client wants to borrow less than the outstanding amount on their existing mortgage, the difference must be repaid on completion of the new loan, and ERCs may apply to this amount. They can borrow up to the original product LTV.

For example, if your client owes £100,000 on the existing property and they want to borrow £80,000 on the new mortgage product for the new property, they will need to pay ERCs on £20,000.

Tip:

As part of any porting application, you can change the mortgage term or repayment type. You can also arrange a transfer of equity by adding or removing a party from the mortgage.

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