RBOS CAM Alternatives

Gordon_Urquhart

Hi,
I have a RBOS CAM mortgae that serves very well.
The bank are completely stonewalling and refusing to allow this mortage to be moved to new property as its discontinued.
Bascially the mortage value stays similar but monthly repayments virtually double on alternatives.
Any suggestions or advice on what to do?
Thanks
Gordon (new user)

homer_j_3

Can you give some more information?

What is the property value?
How much do you need to secure against it?
What term are you looking at?
What features are important to you?
What is your currentl mortgage size?
What rate are you getting on your current deal?
What income do we have to consider for the new deal?

Hopefully we may be able to bring some understanding and suggestions to the table

Gordon_Urquhart

Hi Homer,
Thanks for response.
Current mortage £170K with £50K savings offset, monthly payments £600, 5.8% current rate I think, RBOS CAM.
House value, offer of £350K.
New property (in Scotland) is £395K plus costs of £15K (Stamp, legal, etc).
So £410 less £180 from sale and £50 savings leaves new mortgage balance of £180K approx.
Best quotes I've had are around £1,100 per month, almost double current monthly payments for a £10K increase in mortgage.
£50K income in new job.
Any suggestions, am I missing something?
Thanks
Gordon

Joe_Bloggs

You are missing the repayment term in both cases and the interest rate in the second case.
J_B.

Gordon_Urquhart

15 years left on current.
20 years on new mortgage.
Intrest rate, around 4.5% I think?
Gordon

silvercar

I think what your missing is the effect of the offset. Currently you don't pay interest on the amount of your savings bringing down your monthly repayments.

As you are spending your savings on the next property you won't have any savings to offset so the mortgage payments will be a lot more.

If you intend building up savings you could consider going for another offset mortgage. RBOS do an offset as do Natwest, IF, One Account, Coventry, YBS.

I've got an offset mortgage and wouldn't want to give it up in a hurry. Luckily my mortgage company (coventry) have said that the mortgage is portable so I can move it to the next property.

Joe_Bloggs

The second set of numbers make sense that is £180K over 240 months @4.5% suggest £1138 per month.

The numbers do not make any sense for the first case. If you has no savings in this case the repayment would have been around £1400 per month for 170K @5.8% over 180 months . With savings in place, most treatments, would have shortened the term as you would have increased capital repayments by reducing interest payments by 50000* 0.058 = £248 per month. The total interest paid is around £600 per month in the first year.
J_B.

Gordon_Urquhart

Thanks very much for your responses.
Not sure I'm any further forward mind you......

silvercar

with a lot of offset mortgages you can elect to reduce your payments by allowing for the savings. So for example in your case instead of paying interest on £170k you pay interest on 170-50 = £120k so your current repayments are much lower than you would get on the new mortgage.

Joe_Bloggs

@Silvercar
Thought of that. £120K at 5.8% over 180 months tends to suggest £1000 pm.
To get £600 pm you have to make the term 58 years 9 months.
What is your favourite mortgage calculator ? I don't like this too much but it is offline and does the job.
J_B.
.

silvercar

£120k at 5.8% would have to be interest only to equal £600 per month.

I like the egg mortgage calculator, but it is online!