northan rock mortgage

katie_1985

hi i wonder if anyone can help me this is the first time i have used a forum site and i wanted some info. in sep 07 me and hubby took out a 100 percent mortgage with NR for 154k. we chose a 3 year fixed rate at 7.19 due to expire next sep 2010. however due to the recession our flat will probably be worth around 135k then as its about 130k now. we are overpaying by an extra 500 hundred a month to try and get LTV down but we will only have it down to about 142k by next year. so our LTV will be higher than property is worth and if were lucky break even at 100 percent again. my question is will we be able to fix a new deal with new lender or stuck on NR SVR rate as there not allowing existing customers to renew fixed deals but worred about being on a SVR that will keep changing. info greatly appreiaceted, my old mortgage advisor said wed have to take out a massive personal loan to get the LTV down.

opinions4u

You are stuck with whatever Northern Rock will offer you.

Get your debt down if the terms and conditions allow you to overpay, and pray for a recovery in house prices. Don't count on it though.

Assuming Northern Rock is less than your 7.19% fixed rate, that point in time will give you the opportunity to pay even more off the capital.

It's going to be a long slog though.

katie_1985

i know im hoping due to the economy there rates wont go up to 7.19 anywhere in near future and then hopefully we can carrying on paying even more off, im just a huge worryier and dont like the idea of being on a svr rate not knowing that it goes up and down, why are nr not allowing existing customers to re fix deals. and do you reccomend getting a personal loan to take on some of the Ltv. i just hope and pray house prices go up a little bit at least and that they look at our situation personaaly and see we over pay

opinions4u

katie_1985 wrote: »

why are nr not allowing existing customers to re fix deals.

Not many lenders will allow customers to fix deals when they are in negative equity. Those that do tend to charge higher rates and fees.

There is a broader political issue around Northern Rock as well. Originally it was trying to lose mortgage customers, so not offering deals helped encourage them to go elsewhere (if they had equity). The government has since indicated that it wants NR to do more lending. But if they are reducing the size of the mortgage book by encouraging customers to leave, that policy is obviously flawed.

and do you reccomend getting a personal loan to take on some of the Ltv.

While the maths could work out favourable to do this, it's going to be a close call. I don't think it's a good idea.

i just hope and pray house prices go up a little bit at least

That, combined with continuing to overpay, is your best bet.

and that they look at our situation personaaly and see we over pay

I doubt they will.

_Andy_

katie_1985 wrote: »

and that they look at our situation personaaly and see we over pay

That isn't going to happen.

katie_1985

thanks for your help guys, the only reason i though tthey might is i forgot to mention when we bouth the flat in 2007 soon after my hubby got offered a good job in channel islands we asked NR if we could let the flat out and needless to say the answer was no as we had 100 percent etc they wanted 30 k up front to pay off the mortgage. however we appealed this and explained our salaries in jersey would be double what we were earningliving in our flat in brighton and we pay literally no tax in jersey, we set our a spreadsheet of figures of our wages in bright mortgage payments etc and did the same based on if we moved to jersey and it showed we were better off moving and could then afford to over pay. Nr then changed there mind and agreed to letting property out needless to say here we are today enjoying jersey fab weather. this then leads to other point of saying its probably better to stay with Nr when our product ends next year as we could just go on the there svr and stay in jersey where as trying to re new to a new lender with negative equity and a propertyt we dont actually live in will prove to be extremely hard. so i think your right best bet to stay with nr and take whatever we can get from them and continue to overpay. thanks for info greatly recieved katie