First Direct Legal mortgage

tinkerbell84

Pretty much. But also that all other debts with HSBC will be secured against your house.

So even if you don't default on your mortgage, if you default on your overdraft, loan and credit card, they can use your house to cover the debts.

shell1000

yeah im going to ring the union legal advice line, i get 30 mins free advice, so ill ask them if i can fax it through to them for some advice just to be sure.

But ive never missed a payment yet though in six years and this is pretty much a fixed deal, infact as i can quite acceptably just pay interest only if im struggling, i can even reduce my payments to lower than i intend to pay.

to be honest i just want to try and overpay as much as possible to get rid of it, but at £138,000 and only one salary that could take some time!!

thanks for all your help though, its really appreciated

shell1000

so the answer is to keep your credit card and loan away from hsbc/first direct which is absolutely fine.

overdraft not possible as the 1st account is needed for the mortgage, so i guess i should just stay overdraft free..

charlie2517

Ps am a lawyer for my sins (as I say this is no longer my area of expertise, I've stopped working for the banks and their claims for mortgage arrears and loan arrears, so I only write now from my own personal mortage taking experience) and I'd still always take advice on anything outside my current area even for myself, down to personal preference so do what makes you feel comfortable, if reading the docs you feel comfortable then your decision is made. Just done a quick bit of research for you and it certainly seems like it's a standard clause in their offset mortgages. So I really doubt they'll waive it.

As I say the rent reference is regarding assets not restrictions on the spare room/lodger - mortgages can include such terms but it's not in the text written.

shell1000

yeah im going to ring up first direct and ask if this is a requirement for all of their mortgages and ask for free legal advice from unison.

but i feel a lot happier just understanding the implications of the agreement. i will certainly make sure i keep some money elsewhere and any loans/credit cards are take elsewhere as they were trying to convince me to take a credit card with them too, i dont have any loans thankfully.

I guess you never know whats round the corner, but since getting my lodger ive been saving money in another account to just provide a safety net incase of emergencies so hopefully i should be absolutely fine and be able to move money around. although i may need to open another bank account as my saving money is in a normal hsbc account for its sins!

charlie2517

Sounds like you've got it all covered. Am sure it wont be on all their range of products (although you never know..pesky banks) but from what I've seen doing some research for you it certainly is in the offset t's and c's that I have looked at. Best get myself to bed - am sure you'll get it all sorted! :-)

Night!

shell1000

yeah night thanks again for your help!

tinkerbell84

If you think about an offset mortgage, it makes sense to have the clauses that FD have.

Your mortgage of £138k is a debt to them, but the offset means that you can put that much (and more) into a savings account which will mean you pay no interest and haven't actually repaid any capital (cos it's in your savings account).

You withdraw all the money from your savings account and do a moonlit flit. How will FD get it's money back?

shell1000

yeah i guess. i just dont like the idea that if you default for any reason (you could be incapacitated etc) then they can serve notice and get credit agencies involves and potential repossession. im sure im just looking at it from the most extreme side tho, as i said ive not missed a payment in 6 years.

thanks for your help tinkerbell! how long did your remortgage take with fd? mine allegedly will take another 6 weeks.. not impressed

tinkerbell84

i started the process in April, so 6 months. But that was deliberate because I wanted to get the rate, and it was only valid for 6 months.
I haven't had any issues with them whatsoever.

They did say when I rang them that it was 8-12 weeks for a remortgage.

as for being incapacitated etc, that's what life insurance/mortgage insurance is for

(not that we have either)