Northern Rock Mortgage and Unsecured Loan

ukclarkkent

Hello all,

I've just got a general question about my girlfriend's situation and so therefore can't give useful info but...

She has a mortgage and an unsecured loan on top of that with NR. My general question is that if she sells the house and pays off the mortgage what happens to the loan?

If every case is different then you won't be able to help and that's fine - thanks for reading - but generally can she keep up the loan after the mortgage or has it got to go when the house goes?

Thanks for reading, me.

Dan_1976

Rate will be increased and she will continue to be liable and pay it. The rate will go up a fair bit I think. Its in the KFI and documents she would have got when she took it out.

RedSoleShoes

Hi. The loan should be tied in to the same interest rate as her mortgage (I presume she got a 100% mortgage with part secured, part unsecured?). So when the secured part is paid off, the unsecured rate goes up to around 15-20%. Depending how much it is, she is better getting another loan at a lower rate rather than leaving it with NR.

She can keep the loan, it does not have to go when the house goes.

Fairdo_2

It was the "Togther" mortgage that effectively allowed borrowing of up to 125% of the Home Value. Oh the beauty of Hindsight!

It allowed for up to 95% LTV (Loan To Value) on a secured basis and unsecured borrowing of up to 30% on top at the same rate as the Mortgage Rate for as long as you kept the Mortgage. However, the clause was there that the rate could rise to about 12% at the time should the mortgage go first. Therefore, previous poster wass bang on with the fact that she will most likely be better off rate wise getting a new loan, or paying what she can off that.

ukclarkkent

thanks all for your replies...one further question if i may please.

can she pay off her loan and keep on with the mortgage, e.g. get a personal loan at 9%(ish), pay off her nr loan and then just have her mortgage to think about(or sell her house?)

thanks again

Dan_1976

Yes she can.

jibbering

hi I am in exactly the same position although own the property with my ex. How exactly would you go about paying off the unsecured loan separate from the mortgage?

thanks in advance

Dav82w

I have the same type of loan with NR or NRAM as there now called. £160,000 mortgage with an unsecured loan 'Facility' of £12,000. They said if I wanted to sell the house, at say £165,000 I could, but it would mean I had to take the outstanding 7k and pay something like 12% interest on it. The term of the loan stays the same to so, 7k over 31 years at 12%. about £21 per month. Not a lot but wouldn't want that hanging over me till I retire!