Is it possible to switch mortgage rates with Halifax and borrow more money at the same time?
Yes, Halifax customers can now apply for a new mortgage rate and additional mortgage borrowing through brokers up to four months before their existing mortgage rates expire.
Halifax for Intermediaries has simplified its mortgage process to make it easier for its existing customers to switch rates and simultaneously take out additional mortgage borrowing.
Many mortgage lenders keep the rate switch process separate, so applicants need to apply for a rate switch and additional borrowing separately. They also potentially have different rates. The industry term for a mortgage rate switch is a product transfer, and additional borrowing is known as a further advance.
Halifax's new additional borrowing feature will allow Trinity Financial's brokers to apply for new product transfer mortgage rates and additional borrowing and amend the mortgage term.
Instant additional mortgage borrowing decisions
The mortgage process provides instant decisions, including a decision in principle to confirm when applicants can raise additional funds. It also includes a soft footprint credit search. The system can create and review mortgage illustrations instantly.
Aaron Strutt, product director at Trinity Financial, says, "Halifax has been working on the system to streamline product transfer and further advance applications, which are taken together, making the process better for them and Halifax mortgage customers.
"The trade body UK Finance says 1.8 million mortgages will be up for renewal in 2025, which means many people will raise funds while switching rates. Of those, 744,673 will be low-rate five-year fixed deals dating from 2020, according to Hamptons estate agency."
When can borrowers apply for a simultaneous rate switch and further advance?
It is possible to apply for a simultaneous rate switch and advance within the last four months of an existing mortgage product. The new product will start after the current product ends, and applicants may need to draw down additional borrowing a month before their fixed or tracker rate starts.
When you are within the last 3 months of an existing product, you can start a new product From the 1st of the following month and waive any Early Repayment Charge or Forward date for the new product to begin after the current product has ended. Please note that lenders often change these rate switch qualification rules.
What is the Halifax additional borrowing mortgage criteria?
The minimum further advance amount is £10,000, and a further advance is not permitted within 6 months of completion of the original mortgage.
No arrears - A further advance application cannot be accepted where the existing mortgage is in arrears. Acceptable reasons for a further advance – see Criteria section for a list of acceptable reasons.
The maximum 85% loan to value (LTV) —the existing loan plus the further advance amount must not exceed 85% LTV; if it is above 80% LTV (based on the current indexed valuation), a revaluation will be required, and a revaluation fee will be due. Repayment plans—where the current mortgage has an interest-only amount, acceptable repayment plan(s) must be held, or no further advance will be available.
The most popular reasons for a mortgage further advance are as follows:
- Debt consolidation
- Gift to relative
- Home improvements (shared ownership included)
- Investment purpose (restriction - not for currency speculation or the purchase of stocks and shares)
- Purchase freehold - (conveyancer required)
- Purchase additional land adjacent to property (conveyancer required)
- Purchase extension to lease - (conveyancer required)
- Purchase additional share (shared ownership)
Call Trinity Financial on 020 7016 0790 to secure a mortgage or book a consultation
The information contained within was correct at the time of publication but is subject to change.
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