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Natwest offers new record low 2.95% 5 year fixed rate mortgage
Comments
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Hmm, you save and gather up a large deposit for a better rate, and then they sting you with a fee of £1500-£2500 fee? Which the rate only lasts about 2-5 years. How can they justify this amount? Surely the point of adding a good deposit towards your mortgage is to ensure you aren't a risk, so why the huge fee... truely baffled by some of these charges that come with buying a house.
It's why total costs need to be calculated.
I bet Natwest would be delighted to give someone a £50k mortgage on a £100k property and get them to pay this fee.0 -
It's why total costs need to be calculated.
I bet Natwest would be delighted to give someone a £50k mortgage on a £100k property and get them to pay this fee.
And it doesn't take 2 mins to just do a comparison on your mortgage amount with various lenders offerings to find the most cost effective one for you.
Some people are naturally adverse to paying fees for financial products or advice and would go for the higher rate just because it was fee free, despite it losing them thousands. Its the same reasoning where people will invest in low fee stockmarket trackers (which my their very design are only ever going to give average performance) instead of paying for advice or management and getting a much better return in comparison with the fee.
Some people, eh?0 -
Exactly. I always assumed I'd get the best rate possible when lowering my LTV ratio and obviously be sensible about my borrowings (so wouldn't over extend myself). In reality, to make these attractive fixed rate deals worthwhile I need a big mortgage including a low LTV ratio... which is impossible for the average first time buyer. Whole thing is depresses me sometimes...It's why total costs need to be calculated.
I bet Natwest would be delighted to give someone a £50k mortgage on a £100k property and get them to pay this fee.0 -
Exactly. I always assumed I'd get the best rate possible when lowering my LTV ratio and obviously be sensible about my borrowings (so wouldn't over extend myself). In reality, to make these attractive fixed rate deals worthwhile I need a big mortgage including a low LTV ratio... which is impossible for the average first time buyer. Whole thing is depresses me sometimes...
You just have to try your best to gear your personal finances to match whatever is 'trending' in the financial markets. I've blitzed my mortgage to make sure that I have the 60% LTV necessary to have access to all mortgage products. Now that this has been achieved, I'm thinking that my money is better off invested outside the mortgage rather than in paying it down any further.0 -
How would you invest to make it a better balance though? My savings is sitting in a current account doing nothing, because most interest rates are tiny (ISAs, savings, etc), also the stock markets are very up and down (not that I can play in stocks and shares anyway). The only way I was thinking was sticking the money in a house to make repayments more affordable, this would surely be better than a 2-3% ISA return... happy to hear alternatives...RenovationMan wrote: »You just have to try your best to gear your personal finances to match whatever is 'trending' in the financial markets. I've blitzed my mortgage to make sure that I have the 60% LTV necessary to have access to all mortgage products. Now that this has been achieved, I'm thinking that my money is better off invested outside the mortgage rather than in paying it down any further.0 -
How would you invest to make it a better balance though? My savings is sitting in a current account doing nothing, because most interest rates are tiny (ISAs, savings, etc), also the stock markets are very up and down (not that I can play in stocks and shares anyway). The only way I was thinking was sticking the money in a house to make repayments more affordable, this would surely be better than a 2-3% ISA return... happy to hear alternatives...
It all depends completely on your mortgage rate vs savings rate with a nod towards access (often once you pay monies onto a mortgage, you have difficulty getting it back).
If you are not prepared to accept any risk, then the returns will always be smaller, hence the reason cash saving rates are so poor.0 -
How would you invest to make it a better balance though? My savings is sitting in a current account doing nothing, because most interest rates are tiny (ISAs, savings, etc), also the stock markets are very up and down (not that I can play in stocks and shares anyway). The only way I was thinking was sticking the money in a house to make repayments more affordable, this would surely be better than a 2-3% ISA return... happy to hear alternatives...
as to whether you should pay your mortgage off, difficult to say. depends on a number of factors: current interest rate; what new LTV would be after paying chunk off and therefore what new interest rate would be if you then remortgaged; what rate you could get if you put into savings account; what your risk appetite is etc.
what i definitely can tell you is that paying off your mortgage is definitely better than just leaving your cash in a current account doing nothing and being eroded by inflation.0 -
Such as? Apart from getting the next flight to Las Vegas and putting it all on your favourite colour... there isn't many options for us financial newbiesRenovationMan wrote: »If you are not prepared to accept any risk, then the returns will always be smaller, hence the reason cash saving rates are so poor.
The current interest rate is at a record low, and under this ecomonic downturn, it doesn't appear to be increasing anytime soon. So savers are taking a hit. I was looking to do a 60%-65% LTV when getting my first house, unfortunately I wasn't aware about these upfront fees at the time of saving for this deposit. I'm still baffled why there is this penalty/fee for being a more attractive borrower?chewmylegoff wrote: »as to whether you should pay your mortgage off, difficult to say. depends on a number of factors: current interest rate; what new LTV would be after paying chunk off and therefore what new interest rate would be if you then remortgaged; what rate you could get if you put into savings account; what your risk appetite is etc.0 -
I'm still baffled why there is this penalty/fee for being a more attractive borrower?
Because they still need to make their money from somewhere.
Many of these ultra low rates are nothing but headline grabbers. A cheap way of gaining publicity seeing as the media plaster it all over the place.0
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