Validity of Mortgage offer??? Thanks

lightspeed

Hi

Have received a mortgage offer from A & L and it is valid until October 06.

Wont be completing until the end of June, does this mean that i will get the IR upto then irrelevant of any changes to the BoE base rate, or if the BoE rate changes are the A & L likely to ammend the rate initially quoted?

Thanks in advance.

miaxmia

Don't honestly know, but am assuming it is a fixed rate mortgage, otherwise for sure it will change if the BOE rate changes.

lightspeed

Yes, it is a fixed rate. I was just curious. If the BoE base rate double during this period (i know this is extreme) before we complete, the A & L would surely have something to say about our fix at 4.59%?

thanks

miaxmia

I would imagine that they would honour the offer but, as I say, don't really know.

inmypocketnottheirs

miaxmia wrote:

I would imagine that they would honour the offer but, as I say, don't really know.

Some mortgage providers do and some dont. I have had an offer, then when we came towards completing the product I was having was withdrawn. Then a revised offer was sent out.

AndrewSmith

Your mortgage offer will be honoured at the rate stated, unless anything your end changes, such as change of property or you change jobs etc.

The mortgage offer is basically a letter of promise from the mortgage company saying that based on your current situation ans assuming nothing changes they will lend you the prescribed amount on the named property.

That's what you pay the booking fee for, to book the funds at that rate (even though you may be adding the fee at the end).

Andy

regularsaver1

Althought the offer is in place until October - some KFI's state "must complete by ....." meaning to honour the product

AndrewSmith

That is more for calculation of the APR and the mortgage capital reduction calculations shown on the back page of the KFI.

Must Complete By dates are in respect of the KFI (quote) for quotation purposes, not the mortgage offer itself. The mortgage offer terms and conditions supercede any previous quotes etc as it is the actual defined basis on which the lender is agreeing to lend. This is why all mortgage offers have a fresh KFI attached to them.

Andy

regularsaver1

At work all our products say that there is a must complete by date date (even though they are changing this week)

lightspeed

Thank you for the replies.

On the offer it states:

"This offer is valid ubtil 11 October"

At our discretion, we can withdraw this offer for the following reasons:

1) Your loan is not completed by the 11 October 2006; OR

2) At any time, if something happens which, in our view, would make it undesirable for the loan, or part of it, to be made.

We have an appointment with our solicitor on Friday to arrange the completion and exchange date.

Not heard anything from them, so fingers crossed.

Am i right in thinking that if we exchange before the end of May, the first payment (due in one calendar month) will be the smallest possible (will only have to pay for a few days in May and then all of June). Opposed to completing at the start of June, because we will have to pay all of June and then July???

Thanks in advance!!!

AndrewSmith

Point 1) Answers your question adequately. The mortgage offer conditions supercede any previous quote.

Unless something changes in your situation you are fine till October.

Re payments:

If you complete at the end of May it is likely that your first payment will be for the remainder of May plus all of June, and will be taken at the beginning of July. Check thouroughly with the lender though and hear it directly from the horses mouth so to speak.

Good luck with the exchange

Andy