Doing a mortgage product transfer when under redundancy

7
Found 2nd Mar
Hi all

DH just been told from Monday he'll be under redundancy consultation period. We could do with reducing our mortgage costs and wonder if we can do a quick mortgage product transfer to the better rate.

1. is it fraudulent if we do this product transfer and don't tell them about the risk? (his company is definitely closing so after the consultancy period he will be given his redundancy notice)

2. Is it different legally than a remortgage so ok?

3. if we tell the mortgage provider about the redundancy, is it likely they'll still let us do a product transfer?

thanks!
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7 Comments
Is the mortgage affordable on your salary alone? If so, you could possibly do it but you would have to have the mortgage in your name only. I can't see them taking your husband's salary into account if he is under threat of redundancy. If it were me I'd be completely honest with the mortgage provider and see what they can do
As psycho says, just tell them about the risk of redundancy if they ask. It is a criminal offence to get a mortgage on false pretences and transfering products would not be considered differently under criminal law.
Edited by: "mutley1" 2nd Mar
Are you staying with the same lender but simply transferring to a different product with them? If so it's perfectly acceptable and likely an automated process. No questions asked as they aren't required. If you mean transferring to a different lender then it's as if you're talking out a new mortgage. You would have to answer questions truthfully and would be unlikely to be accepted if you know the job is ending.

Ihope it works out. Very best of luck with finding something else for your husband.
You cannot be made a 'mortgage prisoner' by your lender, so if you're looking to switch products to save money you'll be fine.


A “mortgage prisoner” is a term used to describe someone who is trapped into paying a high interest rate on their mortgage, typically their mortgage lenders’ Standard Variable Rate (SVR). The prisoner may have been on a fixed rate deal in the past, but when trying to remortgage or switch mortgage deals, they are told by their lender that they don’t qualify for the lower fixed rate and so are put into the much higher default SVR.




Look here and here for examples.
I switched my mortgage rate but stayed with the same bank (Nationwide) a couple of months ago. Can be done online and takes 2 minutes. As long as you are not in arrears then they asked no questions - you just select the rate and the date to start from.

If however you are remortgaging from 1 lender to another then you will need to go through the whole application process, provide salary evidence and credit search etc. In this instance they will ask if you are aware of any redundancies.
Thanks all. Yes it's with the same lender, and gives us a potential saving of £190 a month which is pretty significant! We've taken the plunge and made the request over night and hopefully we don't get paperwork saying 'you must inform us of any material change..' otherwise we'll have to fess up. Anyone know if they have to offer another product and not make you a 'mortgage prisoner ' even if you're made redundant and you tell them?
With the same lender, a deal which reduces your monthly payment will not get rejected even in your circumstances. FCA has been looking at this issue for over a year now and has made all the right noises. If your existing lender refuses a product transfer, don't give up complaint and if needed take it to the Financial Ombudsman (though I very much doubt they will reject your product transfer). Good luck.
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