C&G fixed rate ending but only offer SVMR

garyd

Hi All,

Can any one advise me or at least clarify?

My Fixed rate IO with C&G is ending very soon and C&G will not offer me anything other than SVMR.
The girl on the phone informed me this is due to my equity now being worth less so I am into them for 127% of the value. And it's index linked.
?!!!
I pointed out that this is not likely the case but apparently it is 'cos they say it is!

I asked her to remove the terminology that she understands and simplify it for me in to English. She couldn't!
Can anyone enlighten me to what she actually means please?

Many thanks.

All the best,

Gary.

_Andy_

Gary - they're saying they believe you to be in negative equity (i.e. you owe more than the home is worth).

Conrad

Gary you have no equity so they cannot offer you any kind of deal because those deals are limited to maximum loan to value - for example 85% for an ok deal.

The standard variable rate is very low, so use the opportunity to pay down the debt if you can before rates go back up.

koexelek

As Conrad says, you are onto a winner with their SVR.

You would not get a mortgage with any other lender full stop, let alone at 2.5%

beecher

As has already been mentioned, overpay as much as you possibly can while you're on this rate - there's only one way for it to go and that's upwards. When it does you need to have an LTV of less than 90% in order to be able to get a new deal elsewhere.

garyd

Thanks All for your replies.

Yes, I understand their saying that my property, a flat in a still sought after area of North london, is worth less than the mortgage value. My query with them is what do they base this decision on.
Okay, I understand prices have gone down generally however I borrowed less than the property value and spent over £30k renovating to a high standard. Similar properties are selling for the original value at least but she wasn't interested.

Cheers.

_Andy_

OK let's get a few figures

1) How much did you purchase the place for?
2) When was this?
3) How much is owing on the mortgage currently?

opinions4u

garyd wrote: »

Yes, I understand their saying that my property, a flat in a still sought after area of North london, is worth less than the mortgage value. My query with them is what do they base this decision on.

While there is a little more science to it than this, the post code area, the original valuation and average purchase prices since.

Okay, I understand prices have gone down generally however I borrowed less than the property value and spent over £30k renovating to a high standard.

But their indexing system wouldn't know that. Have you asked if you can pay for a valuer to provide an up to date figure on the property? (I'm not saying you should, as £30k spent rarely equals £30k in additional value, but it may be an option).

Similar properties are selling for the original value at least but she wasn't interested.

Are they on the market for that, or are they actually selling for that? There is a difference. Often a big one.

Don't forget, you have one of the best tracker rates on the market at 2% above base when you have the C&G SVR.

Trollfever

The advice given in the 'don't look a gift[STRIKE] horse [/STRIKE], [STRIKE]house[/STRIKE]. flat in the mouth' proverb is: when given a present, be grateful for your good fortune and don't look for more by examining it to assess its value.


http://www.phrases.org.uk/meanings/117000.html


:money:

garyd

Hi,

Look, I don't want to appear ungrateful, I certainly appreciate that the C&G SVR is quite a good deal, I just wanted to fix my rate, fully aware it would be for more than I am paying now.
I have had two redundancies and 11 months in total of unemployment in the last 3 years so just wanted a bit of stability.

I've rang them again and they have said if I can prove that similar has sold for more then they would consider reviewing their offers.
I have been to three estate agents and none are prepared to provide me with any details, however vague.

Andy,
1) How much did you purchase the place for? £250000
2) When was this? August 2007
3) How much is owing on the mortgage currently? £237500 (IO mortgate)

It was a run down top floor flat in a private block in N21. It wouldn't sell and had been reduced again so snapped it up. Like a fool!
Had new fitted kitchen, bathroom, boiler and rads, full rewire inc consumer unit, d/g windows and balcony doors, cleaned and repolished parquet floor. Currently letting for £995 p/m as too small for the family.

I suppose not much I can do but go with it. Just seems not fair but then I'm used to that by now! lol

Cheers All.

Berkshiregirl

If you bought in summer 2007, you bought at the peak of the market. With data from across the country showing prices have dropped since then, it's fair to assume your will have, even with the money you've spent on it.

For details of recent sales in your street, try www.houseprices.co.uk. Also worth looking at what the Halifax price index says your house is worth. If these prove your house is worth more than you paid for it, you may have to get an independent valuation of your property.

You mention it's being let out for £995 a month - have you got your lender's consent for this?