Did we get a good rate?

dai_griff · 30 April 2006 at 6:37PM

Hi,

We have just secured a mortgage of £112050, 95%, through a company called GMAC. I have previous bad credit history, all settled in August 04 but have had 4 defaults registerd agaisnt me with experian since 2002, again all settled. The rate is 5.59% fixed for 2 years, just wondering if I should shop around and get it lower? Has anyone with previous, settled bad credit, got a better deal recently and if so where?

The property is a new build and under stamp duty at £117950.

Me and the GF earn 40k between us with me earning £24,450

Cheers

Dave

KTF · 30 April 2006 at 6:45PM

How did you find the mortgage? If you didnt go through an independent broker then it might be worth having a chat with one.

Mind you, if you have already signed up for the deal above you might not be able to get out of it now.

emmaHarris_2 · 30 April 2006 at 7:00PM

The rate is 5.59% fixed for 2 years, just wondering if I should shop around and get it lower? Has anyone with previous, settled bad credit, got a better deal recently and if so where?

If the deal has not already be completed it may be worth you looking for any clause they may say "we may sell or transfer your mortgage at anytime to anyone etc" or words to this effect. Your going into the sub prime market and maybe you should read more in the sub prime threads. It may or may not help.

http://forums.moneysavingexpert.com/showthread.html?t=186002

Is it fixed or variable mortgage? If Variable rate then it will go up or down with the LIBOR rate over this period.

Is this the discounted rate fixed for this period?

In my experience borrowers sometime, confuse the discount rate and period but still end up paying more when LIBOR changes and particularly after the mortgage has been sold or transferred.

Just wondering!

emmaHarris_2 · 30 April 2006 at 7:01PM

I totally agree with KTF!!!

MortgageMamma · 30 April 2006 at 8:55PM

Hi Dave

Is this the self cert option that GMAC are currently offering or full status? Its hard to see if you could get a better deal without knowing how much deposit you have etc.

MM

MortgageMamma · 30 April 2006 at 8:57PM

Ps - there are some prime lenders that will accept your business but it all depends on the amount of ccj's and when they were paid off. your mortgage rate sounds like a very near prime deal, perhaps it might be an idea to have a look at your options via a specialist mortgage broker

emmaHarris_2 · 1 May 2006 at 9:06AM

MortgageMamma wrote:

Ps - there are some prime lenders that will accept your business but it all depends on the amount of ccj's and when they were paid off. your mortgage rate sounds like a very near prime deal, perhaps it might be an idea to have a look at your options via a specialist mortgage broker

Dave, if you can stay in the prime sector (with a mainstream lender) as MortgageMamma suggest then this will be much better for you long term.

AndrewSmith · 1 May 2006 at 9:16AM

Morning Emma

I agree with MM, always look at the Prime lenders first. You may be surprised at what is acceptable to them without too much of a rate loading, in fact if any at all.

It is not just the rate that is important though, you need to carefully consider the fees, conditions, tie in period and penalties etc.

Even if a prime lender has a rate that is initially higher than a sub prime lender, still do not rule them out. The fees and penalties with the sub prime lender may actually make the true cost of it more expensive.

Andy

emmaHarris_2 · 1 May 2006 at 9:22AM

AndrewSmith wrote:

Morning Emma

I agree with MM, always look at the Prime lenders first. You may be surprised at what is acceptable to them without too much of a rate loading, in fact if any at all.

It is not just the rate that is important though, you need to carefully consider the fees, conditions, tie in period and penalties etc.

Even if a prime lender has a rate that is initially higher than a sub prime lender, still do not rule them out. The fees and penalties with the sub prime lender may actually make the true cost of it more expensive.

Andy

Good morning Andrew.

Your absolutely right Andrew - Fees, Conditions and Tie in period (redemption penalties etc). Also, by going with a sub prime lender you may not respect the 'company' that you may end up with if your mortgage is sold or transferred. It can be an administration only type mortgage that you are compelled to stay with but cannot do much else afterwards.

dai_griff · 1 May 2006 at 9:34AM

hi, thanks so far for the replies.
The mortgage is fixed rate, and we have a 6k deposit.

I have no debts, no CCJ's and have put NOC on my credit file with experian.

The rate the FA got us seems very good, considering I DID have poor credit, the 5.59% is fixed for 2 years, the company is GMAC-RFC ltd.

Is the consences that we could get a better deal??

Regards

Dai

maka_2 · 1 May 2006 at 9:51AM

i am going through getting my 1st mortgage i went through a independent broker he came back with GMAC for me to for 2 years fixed rate at 5.59% we also have ccj's. but he did not mention there was anything in the T&C's that they can sell my mortgage at anytime to anyone.

So have i got a good deal the house is worth £119000 and we are putting down £8000 deposit.

Did we get a good rate?

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