Fixed Rate- is this normal?

KatyC_2

Hi All

We have just had our mortgage offer through from NatWest for a 2 yr fixed rate interest only mortgage.

We first appproached them back in May to get a mortgage in principal- it's taken us this long to find a property. In the paperwork I received this morning it says the fixed rate is applicable 'til the 1st April 2008- 2 yrs from when we made the initial enquiry. However, by the time the purchase goes through this will in effect give us 1 1/2 years at the fixed rate. Is this right? I expected the 2 year period to commence from when the funds are released.

Sorry if I'm rambling- still not awake yet! I will contact NatWest to query this, but wanted your insight first.
Thanks

herbiesjp

There are two types of deal:

1) One where the mortgage product starts from the day you complete
2) With a fixed expiry date


It looks like you have number 2 above, and so irrespective of when the mortgage starts, the fixed rate will finish 1st April 2008

This will normally be very clear on the Key Features Illustration and the mortgage offer you will have received

HTH

KatyC_2

Thanks.
I've just checked through the Key Facts thing and it does say that we have a fixed expiry date. I'm thinking this is a bit mean- what do you think are the chances of persuading them to start the 2yr rate from when the funds are released? I haven't accepted their offer of loan yet- would this mean going through another application?

thanks again

herbiesjp

They will not extend the fixed expiry date on the current deal

You may well choose another deal from them, but you would need to weigh up the difference in rates and fees between the old and new deal

Best thing is to give them a quick call and see what they say

HTH

CLAPTON

did you really mean 1st April 2008? thats only 9 months away.

KatyC_2

Oops- no, meant 2009- told you I wasn't properly awake yet!

UK007BullDog

You might want to go with the original deal as the fixed interest rate is lower than what they can offer you know as there were 2 rate increases since then.

As you are going interest only (is it because of affordability?) then the payments will be higher if you go with a new rate now and the fees might have crept up as well.

Make sure you work out your figures before you make a decision.

Or post all the figures here and someone will do it for you.