FTB, Large Deposit, Total Newb, Lot's of Questions!

efunc

OK, how's my reasoning here? in the present climate a long term fix is good, the longer the better (5-10yrs), however when it comes to trackers, then a shorter term (2-3yrs) is preferable. The reason being that the collar on the current tracker deals is artificially inflated to allow the banks to re-capitalise. As the BoE rate starts to climb to, say, 3% in a couple of years newer trackers may well appear with much more modest collars making the overall amount less of a hike. Conversely, with 10yr fixes available at around 5.6% the real benefit of these won't be evident for another 4-5 years as rates rise and deals start to exceed this mark, so you would need to be in for longer. This is all just speculation of course, but I just wanted to know if my logic was in the right ball park.

Also, am I to understand that when you come off the discounted period of a 2 or 3yr tracker you can then usually change to another lender without penalty? and this is fairly transparent and hassle-free? Do borrows generally do this every couple of years and hunt for the new best rate?

efunc

Arrgh, I have a new dilemma that I didn't anticipate. I checked my online credit report yesterday, only to find that there is a '1 Payment Late' notice on my hsbc current account from 3 months ago! An isolated blemish on an account I've had for 30 years, but a blemish nonetheless, and so recent! I'm not sure if it's accurately recorded as a Payment Late but it arose thus: In December I thought I'd open a Nationwide Mysave account which appeared to be offering the best savings rate, and better than my AA Saving Account. As part of their application procedure they ask you how much you intend to deposit. Not realising it was such a crucial question I just put down £10k as a ballpark figure. Unbeknown to me this was now the amount nationwide would try to request from my hsbc current account, instead of just supplying me with the account number and allowing me to transfer funds in as I liked. I then had to hurry to my AA account to transfer funds into my current account in time for the nationwide request, which was otherwise unfunded. I did this successfully I thought, however instead of transferring in £10000, I'd made a typo and only transferred £1000!! That costly zero that I could hardly see on my tiny computer screen meant that the request by nationwide bounced and had to be recalled by hsbc. I was charged a recall fee and now have a Late Payment notice on my Credit Report

I don't know if this will have any adverse effect on my borrowing abilities, but given the size and nature of the transgression I'm guessing so. having said that I went into HSBC today to see how much they would lend me and they were practically salivating at the prospect. It was clear that they would have no problem offering me much more than £200k should I need it, but I asked for £210k against a £90k deposit. The Lifetime Tracker they offered was 70% LTV at 2.49% (BoE +1.99%) in perpetuity with a £599 booking fee. Of note are the unlimited overpayments with daily interest calculation, and no exit fees or early repayment fees, making it very flexible.

My question is this: Could a mortgage adviser get me anything much better than this? The only way I could envisage this being improved is by reducing/eliminating the fee and achieving a lower rate of interest, say 2.29% or 1.99%, neither of which is particularly feasible I would imagine. Given that so much is said of the advantages of finding the right adviser and the almost certainty with which they can find a better deal it just seems very odd to walk straight into my local bank and buy the first mortgage I'm offered with no other advice!! Am I missing something crucial? Should I study the market and look closely at more obscure offers first? Does anyone recommend going to an adviser to get a better deal?

efunc

Anyone have any thoughts or advice on this for a complete rookie?