Nat west/one account advice please

swing600

Hi everybody

I am looking for advice on whether i am suited to using the one account and hope that someone can help me. I have read the thread started by salty 69 which has been running and can't make my mind up if it would be a good thing or not.

Here's my situation:

Looking to move, house valued at £85,000, exisating mortgage with C & G has £42,000 outstanding. I plan to consolidate my £27,000 worth of unsecured debt, i feel reasonably safe doing this as i have a safe job earning £30,000 a year. We are looking at houses valued at around £135,000 so will probably need a mortgage for about £120,000. Unfortunately in my area the market is dead at the moment and my existing fixed rate deal ends in March after which i going to be hammered.
My financial advisor has recommended i apply for the nat west one mortgage as there are no arrangement fees or penalties. So i could lower my monthly payments considerably by getting a £69,000 mortgage and then top it up or change mortgages when we are in a position to buy without penalties.However when i look at the one account in detail i am not sure if it would be right for me.
I currently spend more money then we bring into the house so credit card debt is always going up but when i have consolidated we will have a little spare each month. In my own mind i have the following pros and cons and would love some advice on whether these are correct :

+ Cheap set up and arrangement fees, no early repayment penalties
+ I will be approxiomately £400 a month better off without having to wait for my house move

- Higher interest rate then available elsewhere
- I would be turning unsecured debt into secured
- It sounds complicated and i have read that unless you have savings at the end of each month i could struggle.

Thanks for any help

Mike

Griptool

I'm sorry I can't give any advice on the suitability of the Natwest product, but, ask yourself why you feel its wise to treble your secured debt at the current time [remember borrowing money from a bank is promising them a sizable proportion of your future earnings] are your future earnings secure in an economic downturn?

Also if the housing market falls by more than 14% you will be in NEGATIVE EQUITY - not a nice place to be.

swing600

Good point about the negative equity, i hadn't given that much thought. my problem is that unless i consolidate my credit card debt my outgoings will remain higher then my income. I can be as confident as is possible about my earnings staying at their same level.
I may look at an unsecured loan for the most expensive credit card debt,i would still appreciate any advice on the One account.

Qual123

the one account is really good if you have a good amount of savings to offset, if you dont then id say a repayment will suit you better, speak to a local mortgage advisor make sure he is fee free and whole of the market and you wont go far wrong.

sarkin

Hey Griptool get a grip man your signature !!!!!!. The whole world works on debt thats how things get done, Its called "leverage"

Hi swing600

some times you need to consolidate when your in a situatuion like yours. it sounds like you need fees free tracker mortgage. the One Acount onlyu really works if you get paid large lumps of money as you can off set. Best to speak with a mortgage broker and get some free advice

wymondham

sarkin wrote: »

the One Acount only really works if you get paid large lumps of money as you can offset

not necessarily true, it all hinges on what's left at the end of the month rather than what you earn/put in.. I am by no means a high earner but this account works for me as I'm tight!

topbombing

easiest way to look at a one acct is simply = huge overdraft facility.

If youve got lots of savings, youve immediatly paid a proportion of that overdraft off...as far as im aware, the one acct doesnt offset ahgainst savings, the NatWest Offset, offsets against savings, they are put into a spearate first reserve account.

silvercar

You say you are looking at houses valued at 135k. At that price you will face stamp duty of 1% ie 1,350. If you bought a slightly cheaper property, under 125k, you would have no stamp duty to pay. If you found a house that was just under the 125k mark but needed a bit of work or conservatory, you could end up with a 135k property without having paid stamp duty.