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    • snoot80
    • By snoot80 19th May 17, 11:24 AM
    • 10Posts
    • 1Thanks
    snoot80
    Nram mortgage nightmare
    • #1
    • 19th May 17, 11:24 AM
    Nram mortgage nightmare 19th May 17 at 11:24 AM
    Hi there I am looking for some advice please. In our haste to get a mortgage we took out a northern rock 100% mortgage in 2006. Seemed like a great idea at the time. The biggest catch with this mortgage is that they made our mortgage up with a loan to pay for the property. Our mortgage is only 87000 but the loan is 22000 leaving us owing 109000. Our house was valued at 110000. Because northern rock went bust we are now NRAM which is an asset management company who no longer offer new mortgages or deals so our APR is ridiculously high at something like 4.79%!! We tried to remortgage but because of a history of poor credit which is starting to improve and the fact we look like we have a 22000 loan which isn't going down we got turned down. We passed affordability but that was it!! Anyhow we're fed up. We've outgrown our house. It needs a shed load of work doing to it and we want to move. We are currently considering just selling up, paying back the mortgage with its stupid loan, renting for a year or 2 and starting fresh with a deposit!! We are financially stable and I think this is achievable within the next 2 years. Has anyone any thoughts or think this not to be a great idea?!! Would be grateful for any thoughts or advice please!
Page 1
    • Pixie5740
    • By Pixie5740 19th May 17, 11:36 AM
    • 10,385 Posts
    • 14,223 Thanks
    Pixie5740
    • #2
    • 19th May 17, 11:36 AM
    • #2
    • 19th May 17, 11:36 AM
    How does the amount of interest you are paying to NRAM each month compare with the rent you would be paying if you moved?
    Annual income twenty pounds, annual expenditure nineteen pounds nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds nought and six, result misery.
    • wantonnoodle
    • By wantonnoodle 19th May 17, 11:48 AM
    • 121 Posts
    • 78 Thanks
    wantonnoodle
    • #3
    • 19th May 17, 11:48 AM
    • #3
    • 19th May 17, 11:48 AM
    I would suggest that you find yourself a good broker.

    Preferably independent, who has experience of dealing with Northern Rock mortgages.

    I would suspect you are not alone in this situation and so there will be a way out of it, just not an obvious one.
    • snoot80
    • By snoot80 19th May 17, 1:45 PM
    • 10 Posts
    • 1 Thanks
    snoot80
    • #4
    • 19th May 17, 1:45 PM
    • #4
    • 19th May 17, 1:45 PM
    Rent in our area is relatively low. We would be paying about £200 less per month than what we are currently paying. The best solution we have been given so far is to move the mortgage part which would just be the 87000 saving us £100 pm and keep the loan with Northern Rock until we can perhaps get a better deal. Northern Rock can do this but obviously will increase the APR on the loan!! Independent mortgage brokers have showed no interest in helping at all as their looking into it as just one big mortgage with little/no equity. Just feeling very stuck.
    • snoot80
    • By snoot80 19th May 17, 1:48 PM
    • 10 Posts
    • 1 Thanks
    snoot80
    • #5
    • 19th May 17, 1:48 PM
    • #5
    • 19th May 17, 1:48 PM
    Just to add though that although we passed affordability we got turned down to move our mortgage due to our credit score. The loan flags up that we have high borrowings ��
    • Pixie5740
    • By Pixie5740 19th May 17, 1:49 PM
    • 10,385 Posts
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    Pixie5740
    • #6
    • 19th May 17, 1:49 PM
    • #6
    • 19th May 17, 1:49 PM
    In that case I would sell in order to be rid of the NRAM mortgage & loan and then rent somewhere.
    Annual income twenty pounds, annual expenditure nineteen pounds nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds nought and six, result misery.
    • Brock_and_Roll
    • By Brock_and_Roll 19th May 17, 2:52 PM
    • 743 Posts
    • 708 Thanks
    Brock_and_Roll
    • #7
    • 19th May 17, 2:52 PM
    • #7
    • 19th May 17, 2:52 PM
    "our APR is ridiculously high at something like 4.79%"


    By any historical measure a rate of 4.79% could never be considered ridiculously high, never mind in a high LTV & inperfect credit situation.


    Obviously it is horrible to feel trapped - as suggested by other posters, the best solutions are either to overpay or to sell up, rent, scrimp, save and re-buy.
    • Thrugelmir
    • By Thrugelmir 19th May 17, 7:08 PM
    • 53,744 Posts
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    Thrugelmir
    • #8
    • 19th May 17, 7:08 PM
    • #8
    • 19th May 17, 7:08 PM
    If you can afford to buy another house. Then you've money to overpay the mortgage and/or the loan. If the mortgage debt is on an interest only basis then you are going nowhere at the current time.
    “ “Bull markets are born on pessimism, grow on skepticism, mature on optimism, and die on euphoria. The time of maximum pessimism is the best time to buy, and the time of maximum optimism is the best time to sell.” Sir John Marks Templeton
    • snoot80
    • By snoot80 19th May 17, 7:25 PM
    • 10 Posts
    • 1 Thanks
    snoot80
    • #9
    • 19th May 17, 7:25 PM
    • #9
    • 19th May 17, 7:25 PM
    Our mortgage is not interest only. It's repayment. I do not have the money to buy another house. I obviously need to save. I have thought of overpayments but the thing that's putting me off is whilst I'm doing that it stops me saving to do things to the house or ultimately to save to get a different house!!
    • robatwork
    • By robatwork 19th May 17, 7:34 PM
    • 3,703 Posts
    • 4,055 Thanks
    robatwork
    I have thought of overpayments but the thing that's putting me off is whilst I'm doing that it stops me saving to do things to the house or ultimately to save to get a different house!!
    Originally posted by snoot80
    Are your savings getting more than 4.79% then?
    • Number75
    • By Number75 19th May 17, 8:48 PM
    • 149 Posts
    • 163 Thanks
    Number75
    Overpayments don't stop you saving for a different house though - they'll increase your equity in the current house so when you sell it, that money can go into your next purchase.
    • poppy10
    • By poppy10 20th May 17, 2:02 PM
    • 5,865 Posts
    • 7,109 Thanks
    poppy10
    our APR is ridiculously high at something like 4.79%!!
    Originally posted by snoot80
    At the time you took out the mortgage in 2006, average mortgage SVRs were 6.5-7%. That's what you would have been budgeting for at the time, so you are getting a great deal compared to what you might have expected to pay. With all that extra cash each month you could have been overpaying your mortgage to get your loan to value to a more reasonable level
    This post is sponsored by MoneySupermarket
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