mortgage advice what would you do?

mummytwinton

help we had a mortgage consultant see us yesterday & we are now more worried than ever. we have the virgin one account house worth 195,000 mortgage £67,000 for now as we have £20,000 on 0% credit card for 12 months. also have car loan £3500 left to pay over 2 years. he told us to add all together ie £91,000 on to a normal mortgage. trouble is we like the flexilility of the one account & as we are only paying interest on £67,000 at the mow i can't see how paying a mortgage on £91,000 would be cheaper. i do have a friend who was on martins show & had a virgin account but doesn't now

i'm sorry i can't work out the tips on this site would anyone be so kind as to help.

he will add 1.95% of our new mortgage amount onto our mortgage for their charge??

PoorDave

Depends on the interest rate of the one acct vs the new mortgage.

Also, since his fee is 1.95% of the total mortgage, he gains more money the more you borrow on your new mortgage.

Does seem quite odd that you would pay less after new mortgage despite having 20k on 0% at the mo.

Might be as simple as: stay how you are = he gets nothing, move to his product = he gets a fee

Why did you see this person in the first place?

homer_j_3

Thought I was going mad....http://forums.moneysavingexpert.com/showthread.html?t=188589

I know what you mean about the fee, dave. I think its probably best to understand what has been recommended first.

I note the 20k on credit cards at 0% and that it seems bad advice to put it to something that is accruing interest, however, if they move all the other stuff to a better product, what do they do with the credit card debt at the end of 12 months.

I do not know their situation so please do not say " they could do this or that" because I know that there are possible answers for this but the advice given may have answered this.

Really the OP seems at a loss to why somebody has suggested this, this is not good as they should have ensured the broker had fully explained it in a way that they understood. Not saying that its anybodys fault because its probably just best for the OP to not allow this to run away and make sure that they fully understand what their broker is trying to do for them..

Ian_W

Couple of other points though homer:

we had a mortgage consultant see us yesterday & we are now more worried than ever

How was this arranged and is the "consultant" a whole of market broker or tied or using a small panel of lenders? Why were you worried in the first place? Mummytwinton you perhaps need to post a bit more info about why you're trying to remortgageand also I think you need to post some info on incomes and property value.

One thing is for sure - if using this "consultant" adds 1.95%[£1775 on £91K] to your mortgage then you'd better double check with another broker that he's providing value for money. The sum involved suggests he's using the risky end of the market rather than a mainstream lender and that may be needed if your debts, income and/or equity in your house don't stack up. If they do, then I'd say he's a rip-off merchant. Do please post more details, there are plenty here who will offer assistance.

homer_j_3

yes, I took the word consultant to be broker and it doesnt bode well that this person is worried, however, some people worry, some people dont so it may not be a reflection on the consultant.

The fee is high and I reserved to make comment on that until I knew what they were actually doing. We will have to see what the OP has to say.

Xbigman

When my 55k mortgage was arranged my broker was paid £200 commision, but not by me. He got it from the mort company, and he had to work for it.
Nearly 2k is obscene. I wouldn't bother going back to that broker/consultant.

As for the OP being worried, if it was because of some negative comments about offset mortgages sometimes working out dearer then they should ignore it. If they are offsetting stooze money it sounds like they are doing exactly the right thing.
Regards



X

mummytwinton

sorry here goes.

we weren't looking to change our mortgage to now we have been very happy with the virgin one account yes we are paying 5.7% but hey it's worked so far for us.
we have an income of 40K a year & have 2 little ones.
we started with 67K on our mortgage but over the last 5 years have done loads to the house adding 25K on to the mortgage taking us up to 92k but after all the money we had paid of our mortgage we are down to 87K then when you add a car loan & holidays we are having in the next 12 months we are up to 97K for everything we owe & have planed.

the mortgage cons phoned up out the blue & we had no plans to change he is coming back today with his ideas but what ever we are not changing this quick with out looking into it more.

i know alot of people say the virgin account is bad but it seems to work for us. i had 12 months off after having twins & the flex of the mortgage helped.

if anything seeing this man has made us look at how much we are over spending just by being silly we can cut back by atleast 200 a month to which we will use to knock of our mortgage.

thanks for advice so far

Ian_W

mummytwinton wrote: the mortgage cons phoned up out the blue & we had no plans to change he is coming back today with his ideas but what ever we are not changing this quick with out looking into it more.

Good on you, DON'T sign up, post details of what is being suggested.

From your second post there appears to be no reason whatsoever to pay him nearly £2K to rearrange your mortgage. Any deal he comes up with would have to go some to beat what you're paying now - given the level of fees being proposed.

There are better deals that will save you money than the one account you're on at the moment and you should consider them because it's better for you to have the money than the lender BUT on the face of what you've said this consultant is a RIP-OFF merchant so don't be bullied or smooth talked into anything without thinking it through.

There are a lot of good professional brokers who post free of charge on here as well as some helpful willing amateurs w2ho'll be happy to assist.

BoL.

silvercar

If you like the flexibility of an offset account then there are plenty of others around offering better rates. I think Yorkshire BS and Coventry BS have rates under 5% also try Natwest and IF.