Is this a good mortgage offer?

Swindler

I'm a FTB and I'm looking to buy a house soon. I'm looking to buy one for around £110,000, I have a deposit of £70,000, so looking for a mortgage of £40,000.

I was asked by the estate agents to have a meeting with their mortgage advisor, Countrywide, she asked me questions regarding my salary and deposit.
I told her I had a £70,000 deposit and was looking for a mortgage of £40,000, I could aford to pay mortgage repayments of upto £500pm and would prefer a fixed rate plus the option to overpay.

She told me I could have a
5 year fixed rate at 5.79% paying £439pm with Northern Rock or
3 year fixed rate at 4.58% paying £416pm with Nationwide

The %'s seem high to me regarding the deposit I have and the amount I am willing to pay pm, plus the fact I'm a FTB.

I am new to this so could someone please find me a better deal, I have an appointment with her on Monday.

Thank you

opinions4u

Swindler wrote: »

She told me I could have a
5 year fixed rate at 5.79% paying £439pm with Northern Rock or
3 year fixed rate at 4.58% paying £416pm with Nationwide

The %'s seem high to me regarding the deposit I have and the amount I am willing to pay pm, plus the fact I'm a FTB.

First time buyers tend to be higher risk, so there's little incentive for this to drive a preferential rate.

I am new to this so could someone please find me a better deal, I have an appointment with her on Monday.

Moneyfacts shows 3 year deals starting at 4.19%. But there are only 3 lenders shown quoting lower rates than your Nationwide offer.

5 year deals seem to be cheapest at Newcastle and HSBC.

My guess is that your mortgage adviser doesn't deal with these cheaper lenders and you will have to contact the lender directly to access the deals (EDIT: or find a genuine 'Whole of Market' advsier who will most likely charge a fee).

HSBC appear to be cherry picking quality at the moment - if it ain't perfect in their eyes they decline it. A lot of mainstream borrowers are reporting being declined, despite no poor credit.

koexelek

opinions4u wrote: »

My guess is that your mortgage adviser doesn't deal with these cheaper lenders and you will have to contact the lender directly to access the deals.

.

Countrywide work on a very small panel of lenders and are not whole of market

Mrs_Bumble

Countrywide panel include: Abbey, BM - Birmingham Midshires, Chelsea, C&G, Halifax, Nationwide, Natwest, Northern Rock, Platform, Scottish Widows Bank, The Mortgage Works.

One of my clients gave me their leaflet this week lol

Swindler

I thought I'd get a really good rate because of my ltv.
I was hoping to pay the mortgage off within 10 years, even sooner if I over paid.
I thought that the banks were trying to encourage FTB to take mortgages out if they were secure in the knowledge that they were low risk, which I am.

hethmar

Swindler, if you get a fixed rate then its likely you wont be able to overpay anyway - do check that out. What sort of rate did you think you could achieve at the moment? Have you tried comparison sites to check it out?

Swindler

The mortgage advisor said I could overpay by upto £500 a month.

I thought being in my position around 4%, what % do people get if they have less deposit and need a larger deposit?

dimbo61

Have you looked at first direct 3 year fixed OFFSET mortgage !
Good rate and you can build up savings in the offset account !

herbiesjp

You can definitely get better than the deals offered.

Just depends on finding a good whole of market adviser who will tell you where to find them

opinions4u

Swindler wrote: »

I thought I'd get a really good rate because of my ltv.

Well, they are better rates than you'd get with a 90% LTV.

I was hoping to pay the mortgage off within 10 years, even sooner if I over paid.

You still can!

I thought that the banks were trying to encourage FTB to take mortgages out if they were secure in the knowledge that they were low risk, which I am.

The reality is that the lenders have a shortage of funds and are risk averse. They don't really want to lend to anybody.

Low supply = higher prices
Risky economic climate = higher prices

Spangled

Swindler - have you considered a tracker? The amount you want to borrow — £40k — is small by current standards and won't be affected so much by interest rate fluctuations.

For example, a BoE +2.49% tracker would see you currently paying £191pm (assuming repayment mortgage over 25 years). Even if the BoE base rate shot up to say 7% (giving you a pay rate of 9.49%), you'd be paying £352pm.

Trackers generally allow unlimited overpayments, whether that be one-off lump sums or regular monthly overpayments plus no early repayment charges. You'd then be more likely to be able to pay off the mortgage within your 10-tear time frame.