Friend+Gf applying for m.gage- what %?

bob_dob

Bumpy Bump?

bob_dob

Hi, please could i be cheeky and ask if someone can answer the question?
Thank you.

betmunch

Mate, when its outside of office hours I wont be likely to post here, no need to bump it.

The rates from those lenders are higher, substantially higher.

I would clarify the figures before ringing any alarm bells

bob_dob

Sorry for that, i really appreciate your help and didn't mean to annoy you. If im honest, it wasn't neccessarily to get an answer from you, it was to get an answer from anyone.

Thanks for the advice. Yes my friend now says he isn't sure what rate until he gets home.

Please may i risk your wrath by asking what rates those providers do offer?

betmunch

Dont worry I wasnt annoyed, just saying no need to bump.

Of the lenders you have mentioned the best you will find is 5.29%.

And just to be clear I am not recommending anything here. I'm telling you a rate that is available with the figures you quoted, from the lenders you mentioned.

Sorry to sound like a !!!!!!, but I cannot be seen to be giving advice to someone I havent done a fact find on so I have to make it clear thats not advice!

bob_dob

Mate you dont sound a !!!!!! and i totally understand why you have to put that.

Thanks for explaining so much to me.
My friend seems to think he may be wrong with the 4% he quoted so will find out tonight what it really is/was.

I have a feeling though that being as has his heart set on this particular house, it wont make a difference if the rate is 20%, he'd still go for it.

Is there any basic calculation i can show him that will highlight the difference between, say, a good rate of 3.2% (if he saved up a larger deposit) and the expected 5.29% he'll pay with his current deposit?
I was thinking maybe the total paid at the end of the initial 2 year period?

pjcox2005

If you go on the main website and the top tab of mortgages & Homes, there is a mortgage calculator. That will help you model the difference.

The overpayment calc in particular is very good at showing the total cost over the length of the mortgage and the impact of making overpayments.

bob_dob

Thank you. It looks brilliant and is very helpful!!

bob_dob

I see that if they use their current deposit of £15,000 and take out a mortgage of £105,000 and spread it over 30 years, with a rate of 5.2%, their repayments would be £580 per month and pay a total of £208,000

However, if they were to be able to get a rate of 4.2%, use £20,000 deposit and take a mortgage of £100,00 and spread it over 25 years they would have repayments of £539 and pay back a total of £161,683!!!!

So, my question is would a 20% deposit get them 4.2%?
And if not, what would? As a total saving of roughly £47,000 is absolutely shocking!

betmunch

Even with the £15,000 deposit there are rates as low as 2.49%, just not from the lenders you quoted earlier. Whether your friend qualifies, or even wants this product is a whole other matter. Even without doing a full fact find I suspect this is not the product for your friend, but would stand to be corrected!

With a £20,000 deposit and restricting the lenders to the three you mentioned, NatWest have a direct only product only for existing account holders at 4.59%.

Once again, this is just pointing out some products that are available and is not in anyway a recommendation that you should go out and get it!