Totally confused - is it worth fixing?

edited 1 October 2009 at 2:08PM in Mortgages & Endowments
13 replies 930 views
welshgaz1979welshgaz1979 Forumite
6 Posts
edited 1 October 2009 at 2:08PM in Mortgages & Endowments
Hi,

I've just come off a fixed rate with Direct Line where I was paying £634 per month on my mortgage with a balance of £90,500 remaining and house value of approx £120,000.

I've approached a company and they suggested a 5yr fix at 5.99% which sounds OK, but they have suggested that I consolidate two personal loans into the mortgage. One with approx £3500 (approx 2yrs remaining at 10% apr paying £172 p/m) outstanding and the other with £ 6500 (approx 4 yrs remaining at 9% apr paying £135 p/m) outstanding. This would bring me to a mortgage balance of £10,500 over 24 yrs.

I'm not sure whether it would be better to leave these two as they are and just look at the mortgage as when the fix ends, we are going to be in a worse position in terms of LTV than we are now. The 'consultant' suggested that this would be best, however I know that she is on a fee and so it is in her interest to get as much as possible onto the mortgage and this may not be the best case for us.

For the new mortgage with the loans included, she has quoted £675. We will be paying £440 on the current SVR, but obviously this WILL rise. At todays rate, we will be paying £700+ per month keeping them separate, but long term I am unsure as to what would be best for us.

I have two young children and so stability is important to us at the moment.

Sorry for such long winded post, but I thought I'd best give all of the numbers as people here seem to know a lot more than I do about this and I'm not sure what you'd need to work out what's best. :huh:

Thank you all in advance!!
Welshgaz
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Replies

  • Has the adviser suggested the term of the consolidation (i.e. the loans) are kept the same, or are these to be the same as the rest of the mortgage (24 years)? If they are suggesting 24 years that's pretty shoddy advice.
  • _Andy_ wrote: »
    Has the adviser suggested the term of the consolidation (i.e. the loans) are kept the same, or are these to be the same as the rest of the mortgage (24 years)? If they are suggesting 24 years that's pretty shoddy advice.

    Yep, thought as much. She suggested putting the loans onto the mortgage for the full 24yr term. I did some quick calculations and it almost doubled the amount that we'd pay back on the loans (albeit over a significantly longer period).

    Thank you for your reply, it's helping me to decide exactly what to do with her advice. I'm pushing now towards turning her down on her advice and going it alone. I was skeptical when she just slated everything that Direct Line had done for us and did the old 'sucking through the teeth' when she saw out loan paperwork. She also expected us to sign up last night almost immediately on presenting the details to us. Annoyingly, (and all my fault) I gave her the loan paperwork and mortgage statement 'to take away so she can work on the figures'. She promised to bring it back last night but didn't. I guess it's a trick to make it harder for us to look elsewhere while she's got us hooked. I feel so daft now letting her get away with this. She even tried the 'but the rates are only fixed for today so I can't guarantee that you'll get these rates' trick. Luckily I saw that one coming! :mad:
  • I've just had a further conversation with the 'advisor' and tried to break down the fees that she is charging. The company that she works for charge 1.99% commission (from the internet site).

    She has also recomeded a will for myself and my wife as we don't already have one. Totally agree that this is a good idea and we need to sort it, however she has told me that this cost of £999 is added to the mortgage. A quick google search reveals that they can be arranged on the internet for £40.

    I'm losing confidence in this company quicker than the red top newspapers in Labour!! :rolleyes:
  • Get rid quick!!!!

    Ask for your paperwork back and get somone else to do this for you if you want, who is not going to rip you off like this

    It is scandalous!

    Even the wills for £999!!!

    What next???
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • Name and shame the broker - that's awful advice and as herbie says, the will price is ridiculous.
    The bad advice should be reported to their network if they have one.
    Avoid like the plague, do not do business with this person.
  • £999 for a will!! Hells teeth, if a mirrored will costs £125 (to be done properly) then that's an unbelievable £874 commision for simply passing your number on.....just incredible.

    This isn't advice this is sales, pure and simple. There is no place for this kind of carry on in the market imho.
    Happily an ex mortgage broker!
  • 5.99% fixed rate is not even a particularly good price for a mortgage in my opinion.
  • Thank you both for your help, I think I'm decided now!!

    The company was Carrington Carr. I signed up (I think) through the Halifax website and they called me the following day.

    They took all of my details regarding our finances and told me that the 'advisor' would visit and take no more than 1 hr. When she arrived a few days later, she took all of the details again and took over two hours making me late for work.

    She is very false and a text book sales women. She insisted on going through scare tactics showing us the 'average ages of getting serious illnesses' and asking 'so what do you thin of that?' regularly. I appreciate that she's probably trained this way, but I find it patronizing and can't do business with people like this.

    I will call her later to see if she can find anything with just the mortgage included, but I feel our relationship will end abruptly!!

    Thanks to you all for your help and advice, you've saved me a quite a bit of money and saved me from kicking myself in a few years when i realized what I nearly signed up to.

    (ps please ignore the 'americanised' spelling in my posts, it appears that the spell checker thinks I'm from the other side of the pond. Ah well, it's better than that red squiggle under the words!) :o

    Thanks again
    Gaz :money:
  • Gaz - the fee she's charging is very high - can I suggest you pull out regardless of whether she just does the mortgage? They've already demonstrated they're unethical, why would you still want to do business with them?
    Use another broker or source the mortgage directly.
  • Thank you both for your help, I think I'm decided now!!

    The company was Carrington Carr. I signed up (I think) through the Halifax website and they called me the following day.

    They took all of my details regarding our finances and told me that the 'advisor' would visit and take no more than 1 hr. When she arrived a few days later, she took all of the details again and took over two hours making me late for work.

    She is very false and a text book sales women. She insisted on going through scare tactics showing us the 'average ages of getting serious illnesses' and asking 'so what do you thin of that?' regularly. I appreciate that she's probably trained this way, but I find it patronizing and can't do business with people like this.

    I will call her later to see if she can find anything with just the mortgage included, but I feel our relationship will end abruptly!!

    Thanks to you all for your help and advice, you've saved me a quite a bit of money and saved me from kicking myself in a few years when i realized what I nearly signed up to.

    (ps please ignore the 'americanised' spelling in my posts, it appears that the spell checker thinks I'm from the other side of the pond. Ah well, it's better than that red squiggle under the words!) :o

    Thanks again
    Gaz :money:
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