Good Deal ?

keithsav

Hi all,

I've a Fixed rate mortgage with Northern Rock, which is coming to an end in 3 months. I've just received an offer from them, offering to fix the rate at 4.99% for either 2 or 5 years, with an arrangement fee of 695 and an optional Admin. fee of 250. (the interest rate is 5.39% if you don't pay the admin. fee).

It looks like a reasonable deal to me, does anybody have any thoughts on these ?

Thanks,

Keith

cloud_dog

With these deals its important you dont just look at the underlying rate. You need to add up all the interest you will pay over the term (2 or 5 years) then add on the arrangement fees to see if financially you are better off.

cloud_dog

MarkyMarkD

That's how NR make their money.

4.99% isn't a bad rate for 2/5 years fixed, but £945 IS a bad fee.

You could remortgage to another lender for the same cost, on around the same rate - but of course, that's a lot more hassle.

(Actually, from the Portman you can get 4.49% for 2 years with a £399 fee, and 4.89% for 5 years with a £599 fee, both of which are better value than what NR are offering but more hassle.)

keithsav

Hi,

Thanks for the replies - Even though the fees seem a bit steep, might still go for it - Like you guys say, less hassle !!!

There's an indicative APR on the offer letter, 6.7% on the 2 year fixed, 6.3% on the 5 year.

Cheers,

Keith

payless

APR's assume the current SVR (Standard Variable Rate) for the remaining term after the fixed period