Northern Rock going bust question

Debs12

THANKS TLcK9.

We have fully completed the paperwork and have the full mortgage offer. I know they will have to honour it! I suppose it is just how savers are in hurry what if they dont physically have the funds on 19th October!

We are just wanting to move house and do not need any more stress!!

mstar

i had a remorgaing offer from northern rock does that mean they will void this aggreeement? as i heard a rumour that they are freezing new morgage/remorgages until they ride this little difficulty?????????

tlck9

mstar wrote: »

i had a remorgaing offer from northern rock does that mean they will void this aggreeement? as i heard a rumour that they are freezing new morgage/remorgages until they ride this little difficulty?????????

If this was the case, the advisor would have heard and called me...I remember when I worked with a mortgage advisor they got an electronic message come through to say, such and such had pulled their mortgage deals (usually when the rates went up)

I would imagine they would work the same way with this situation, if NR werent taking any more lending then they would have to send notice out...

Also what you have to remember is that funding for the current rates will have been allocated already on the funds market, once those funds have been allocated then I would imagine that is when the rates will freeze or be withdrawn...

I'm not an expert but I would imagine this is the case.

HelpWhereIcan

Northern Rock should be honouring all current mortgage offers.

There have been lenders that have decided not to honour offers due to "changes in the market" etc, but the NR is not one of them.

As tlck9 says, they would normally advise brokers of something like that, but we have had nothing from them to that effect.

NR are not hugely competitive at the mo anyway (and that was before the current problems set in) so it may well be that they are quite happy that their current deals etc are profitable enough - the issue is where their next bit of business is/was going to come from.

I suppose one of the things is constantly being overlooked is the fact that the facility with the Bank of England has not been used and NR requested it in case they needed it, but it would seem that they have enough funding in place at the mo (seperate from BoE) to fund their current batch of deals.

Once they are gone, who knows.

mstar

well i would be amazed!! if they withdraw their remorgaing offer to me (it was before this crisis) as this would send further signals to people that they are not lending and having difficulties i would like/guess the best policy would be to keep business as usual.

tlck9

HelpWhereIcan wrote: »

NR are not hugely competitive at the mo anyway (and that was before the current problems set in).

No my rate isnt the best, however it gave me the flexbility I needed, at 5 year fixed 7.29, but 100% mortgage and a 5.86 x income they seemed the best bet

inmypocketnottheirs

tlck9 wrote: »

No my rate isnt the best, however it gave me the flexbility I needed, at 5 year fixed 7.29, but 100% mortgage and a 5.86 x income they seemed the best bet

Is that not a root part of their problem?

WTF?_2

HelpWhereIcan wrote: »

Northern Rock reportedly expected £2bn to be withdrawn on Friday alone so could be doing better than even they expected.

If less money than expected was withdrawn during the run on their bank, then why was it necessary for the Chancellor of the Exchequer to make an historic, unprecedented pledge to underwrite all their savings yesterday evening?


Doesn't exactly tally with 'actually we're losing less deposits than we thought we would' , does it?


Look at the actual available facts and draw your conclusions from them, don't believe the media spin and press releases.

toonfish

inmypocketnottheirs wrote: »

Is that not a root part of their problem?

no, a lack of funds available in the market place is the root of their problem. NR lending book is top quality.

tlck9

inmypocketnottheirs wrote: »

Is that not a root part of their problem?

I've heard that NR lending policy is one of the best...

I understand that the problems in America knocking the share index down, a series of investments that havent done as well and them not being able to access funding from the markets due to the low prices have cuased the problem

Certainly not to do with bad lending - i think it was reported they have one of the lowest default....meaning that they will lend to poeple with good history and perhaps not be so competitive for risky prospects or certainly not lend so much to others with not quite so high credit rating