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Every £1 I borrow I will pay back £2.24 - Is that right!?!
gmailwill
Posts: 6 Forumite
A quick question for you re mortgages from a mortgage newbie.
When you get a mortgage it seems standard that all lenders give you a projection of what you will be paying back over time, what happens if interest rates go up by a 1% etc so you know what you are in for. I have had this info from both Abbey and Halifax when "shopping around" for a mortgage.
Abbey gave me this breakdown and in it it says that for every £1 I borrow I will be paying back £2.24. That's way over 100% interest isn't it!
Is that normal? If they were loan sharks I'm sure they wouldn't get away with that!
What do you think?
Will
When you get a mortgage it seems standard that all lenders give you a projection of what you will be paying back over time, what happens if interest rates go up by a 1% etc so you know what you are in for. I have had this info from both Abbey and Halifax when "shopping around" for a mortgage.
Abbey gave me this breakdown and in it it says that for every £1 I borrow I will be paying back £2.24. That's way over 100% interest isn't it!
Is that normal? If they were loan sharks I'm sure they wouldn't get away with that!
What do you think?
Will
0
Comments
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Fixed rate mortgages allow you to know what you are going to pay each month, check the costs of remortgaging at the end of the fixed period (normally about 5 years) at which point you can remortgage on another fixed rate.
I would look on the mortgage info on this site it has some great tips and sites to help you pick the right one.
(I think the £2.24 for every £1 is high....but around the £2 mark for every £1 is pretty standard from my searches):hello: TTC since 11/090 -
gmailwill wrote:A quick question for you re mortgages from a mortgage newbie.
When you get a mortgage it seems standard that all lenders give you a projection of what you will be paying back over time, what happens if interest rates go up by a 1% etc so you know what you are in for. I have had this info from both Abbey and Halifax when "shopping around" for a mortgage.
Abbey gave me this breakdown and in it it says that for every £1 I borrow I will be paying back £2.24. That's way over 100% interest isn't it!
Is that normal? If they were loan sharks I'm sure they wouldn't get away with that!
What do you think?
Will
If you are borrowing for a year or two i agree, but i presume the loan is over 25years so its about par for the course?
I'ts probably a shortish term discount or fix with 23 years on Standard Variable Rate.
Hope this helps/ reassures
SSI am a fee charging WoM Mortgage broker.I now no longer give information and opinion within the Mortgage boards, because a number of posters who, having approached me professionally, agreed my fee-which has been been made very clear at the outset, taken my advice (normally cancelling a [home visit] meeting at short notice) have then approached one of the fee-free brokers on here to arrange the very same deal I have advised.Whilst I totally concur with the ethos of "money saving"- abusing the goodwill of a professional who provides a quality service is taking it too far! :mad:0 -
Thanks for the info, it's specifically the "£2.24 for every £1" that I want to know is correct or not. It just seems like a hell of a lot of interest to pay back!
Will0 -
stanmoresaver wrote:I'ts probably a shortish term discount or fix with 23 years on Standard Variable Rate.
It's 25 years incl 2 years fixed at 4.94% then up to 6.5% unless I re-assess with them for a better rate.stanmoresaver wrote:Hope this helps/reassures
Yes, thanks - that's useful.
Will
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It's at the top end for a 25 year mortgage, but it is ok- presumably you will remortgage when you get to the SVR section so, given the fact it assumes that the rate won't change for 300 months, it's rather academic.
But yes it's realistic, you should see some of the Sub-prime ones.
SSI am a fee charging WoM Mortgage broker.I now no longer give information and opinion within the Mortgage boards, because a number of posters who, having approached me professionally, agreed my fee-which has been been made very clear at the outset, taken my advice (normally cancelling a [home visit] meeting at short notice) have then approached one of the fee-free brokers on here to arrange the very same deal I have advised.Whilst I totally concur with the ethos of "money saving"- abusing the goodwill of a professional who provides a quality service is taking it too far! :mad:0 -
gmailwill wrote:It's 25 years incl 2 years fixed at 4.94% then up to 6.5% unless I re-assess with them for a better rate.
Yes, thanks - that's useful.
Will
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If you are looking at a two year fix, then don't really worry too much about long term- because you will remortgage
If you are borrowing under 75%, you can get better than that rate BTW.
SSI am a fee charging WoM Mortgage broker.I now no longer give information and opinion within the Mortgage boards, because a number of posters who, having approached me professionally, agreed my fee-which has been been made very clear at the outset, taken my advice (normally cancelling a [home visit] meeting at short notice) have then approached one of the fee-free brokers on here to arrange the very same deal I have advised.Whilst I totally concur with the ethos of "money saving"- abusing the goodwill of a professional who provides a quality service is taking it too far! :mad:0 -
stanmoresaver wrote:If you are borrowing under 75%, you can get better than that rate BTW.
Yes, the house is 93.5k and I have a 40k deposit.
And sorry, it's 30 years (can be changed at any time though) so loan of 53.5k fixed at 4.94% until 3 Jun 2008 then up to 6.5% after that.
Sound ok to you?0 -
It depends on what benefits/flexibility you are looking for from the mortgage however there are currently deals that you may be eligible for in the 4.3% regionI am a Mortgage AdviserYou should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.0
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I will not, as a matter of principal recommend a product, without knowing the full detail. My PII is expensive enough!
However, take a little peek at the other lender in your OP who brought out a new product range last week and has produced offers for my last two applications sent to them within 3-4 days!
SSI am a fee charging WoM Mortgage broker.I now no longer give information and opinion within the Mortgage boards, because a number of posters who, having approached me professionally, agreed my fee-which has been been made very clear at the outset, taken my advice (normally cancelling a [home visit] meeting at short notice) have then approached one of the fee-free brokers on here to arrange the very same deal I have advised.Whilst I totally concur with the ethos of "money saving"- abusing the goodwill of a professional who provides a quality service is taking it too far! :mad:0 -
stanmoresaver wrote:I will not, as a matter of principal recommend a product, without knowing the full detail. My PII is expensive enough!
SS
Well said - guidance and direction is one thing, product recommendation on an open forum is another.I am a Mortgage AdviserYou should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.0
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