Urgent help please!

Mourinho_2

Just went on to the Halifax svr of 4% there on Monday on my mortgage of an interest only.House is valued at 109,000 and the mortgage is for 100,000.Just seen there today that Northern direct are offering a 25 year tracker of 1.99% above the base rate(works out at 2.99% at the moment),ltv of max 94% and a fee of £799.00.
Basically does this sound like a good deal?Or should i stay on my interest only at the moment and overpay,or should i hold on and wait to see if i get a good fixed rate deal for 5 years plus?
Any help would be GREATLY appreciated as im not really up on these matters.

sammyjammy

Northern Direct? And base rate has just been reduced to 0.5%

Rossa_3

Your house may be valued at 109k by an agent but there have been reports that surveyors working for mortgage companies valuing for mortgage purposes are undervaluing because they are taking into consideration that the market may drop further which would mean you may be in negative equity sooner rather than later.

So you may not get the Northern deal as if they only value your house at 100k or even 105k then you will be outside of the 94% LTV.

Have you checked if your current SRV product is linked to the base rate? 4% is quite low so it may be. If it is check to see if it has a floor or collar on it i.e. it will not go below a certain rate. To be valid, it has to be in your KFI, Key Facts Illustration, or your mortgage terms and conditions, so check those if you don't want to have to deal with the call centre. Don't rely on a call centre operator to have the answer as I had to ask about a collar on mine, which she had never heard of. and it took 2 months to get an answer from them.

I came off a fixed rate last September onto what I thought was a very high rate of over 7%. (2.3% over base of 5%) Turned out that it was linked to the base rate so as of today I'm now on 2.8%, considerably less than even the fixed rate I was on.

Mourinho_2

Bought the house 2 years ago for £156,000.£109,000 is the valuation halifax said it is now but other price indicators say £113,000 - £125,000.Sounds a big depreciation?