few questions about fixed mortgages.

Essex_Lee_

Hello there,

I'm moving house soon and moving in with my partner, we both have different views on which mortgage to get, I'm thinking of getting one with one of the main banks, i.e. Halifax. and getting a good deal, whereas she wants to go with a small independent building society i.e. Birmingham Midshires and doesn't mind if its 3 or 4 hundred pound more than the Halifax.

The reason she is giving is, if we get a fixed mortgage with Halifax or another big named bank, they might sell our mortgage on to another bank and that bank will put our fixed rate up and we will not have any say in it and be stuck paying a fortune.

Whereas a small independent building society will not do that, as they have no debt.


Is she talking rubbish? surly they cannot do that ?


Thanks

_Andy_

If the debt is sold, the T&Cs remain the same. So, no, the rate wouldn't be affected

Essex_Lee_

what are the chances of it being sold on if we go with the hailfax, are they known for doing that kind of thing ?

Thanks

Essex_Lee_

If we go on a variable rate and they sell it on can they then put it up and we wouldn't be able to do anything until the term ends?

Thanks

MarkyMarkD

Essex_Lee_ wrote: »

Hello there,

I'm moving house soon and moving in with my partner, we both have different views on which mortgage to get, I'm thinking of getting one with one of the main banks, i.e. Halifax. and getting a good deal, whereas she wants to go with a small independent building society i.e. Birmingham Midshires and doesn't mind if its 3 or 4 hundred pound more than the Halifax.

The reason she is giving is, if we get a fixed mortgage with Halifax or another big named bank, they might sell our mortgage on to another bank and that bank will put our fixed rate up and we will not have any say in it and be stuck paying a fortune.

Whereas a small independent building society will not do that, as they have no debt.


Is she talking rubbish? surly they cannot do that ?


Thanks

I am amazed at _Andy_'s restraint on this very funny post.

Birmingham Midshires is not a small independent building society. It is a trading name of Halifax!

So there's no difference at all between a Halifax mortgage and a BM mortgage.

Back to the main topic - if you have a fixed rate loan, it's fixed for the agreed term. If there's a contractual revert rate - i.e. it's guaranteed to be Bank base rate plus 1% at the end of the fixed rate - then that's binding too.

The only (minor) risk is that if it reverts to "standard variable rate" that rate could be less attractive if the mortgage has been sold off to someone else.

But it's really an academic risk if you borrow from a mainstream lender. It is more relevant if you are borrowing from a dodgy lender who lends to dodgy borrowers, as they are always going out of business and selling their mortages off to someone even more dodgy who then ups the rates.

Robert_Sterling_3

Essex_Lee_ wrote: »

Birmingham Midshires and doesn't mind if its 3 or 4 hundred pound more than the Halifax.

Birmingham Midshires was a Building Society but that was last century.
I think it was taken over by Halifax Bank which I think then did a reverse take over of Bank of Scotland to become HBOS.

HBOS had to be rescued so it got taken over by Lloyds which had earlier taken over the Trustee Savings Bank and Cheltenham and Gloucester Building Society.

HBOS was taken over by Lloyds and then Lloys shares I think went down the pan somewhat.

So much for Birmingham Midshires being a small independent Building Society.

LisTT

Sorry if this is the wrong place to post this. I have a mortgage with BM, fixed rate ends this summer - according to what I have when it moves on to variable it will go up by about £60 a month. I want to switch to another fixed rate and get a better deal or should I be looking at a variable rate? Sorry for all the questions, not really sure how I should proceed with this - speak to an IFA?

taker920

LisTT wrote: »

Sorry if this is the wrong place to post this. I have a mortgage with BM, fixed rate ends this summer - according to what I have when it moves on to variable it will go up by about £60 a month. I want to switch to another fixed rate and get a better deal or should I be looking at a variable rate? Sorry for all the questions, not really sure how I should proceed with this - speak to an IFA?

Depends a lot on your LTV, if its less than 60% you can take your pick.

In terms of fixed vs variable, who knows. The base rate is likely to remain low for the next 18 months but after that is anyones guess.

taker920

Essex_Lee_ wrote: »

Hello there,

I'm moving house soon and moving in with my partner, we both have different views on which mortgage to get, I'm thinking of getting one with one of the main banks, i.e. Halifax. and getting a good deal, whereas she wants to go with a small independent building society i.e. Birmingham Midshires and doesn't mind if its 3 or 4 hundred pound more than the Halifax.

The reason she is giving is, if we get a fixed mortgage with Halifax or another big named bank, they might sell our mortgage on to another bank and that bank will put our fixed rate up and we will not have any say in it and be stuck paying a fortune.

Whereas a small independent building society will not do that, as they have no debt.


Is she talking rubbish? surly they cannot do that ?


Thanks

In short, yes

LisTT

taker920 wrote: »

Depends a lot on your LTV, if its less than 60% you can take your pick.

In terms of fixed vs variable, who knows. The base rate is likely to remain low for the next 18 months but after that is anyones guess.

Thank you for your response. But whats an LTV (couldnt find an embarassed emocion to use!)

Peelerfart

Loan To Value

e.g 100K house,60K mortgage = 60% LTV