Northern Rock End of Mortgaged Deal (Merged Threads)

deefadog

Just on the basis it was mentioned on here! I am not arguing with what i sign up for, just if i can get out then i would

MarkyMarkD

NRAM isn't really a "bad bank" in the sense that many people have suggested. It's bad because NR's lending on the whole was bad, not because the worst loans from NR have been moved into NRAM.

I know that none of you accept that NR's lending on the whole was bad, but the fact that their average LTVs are way higher, and their income multiples were way higher, is fact not incorrect presumption. As dasilva has pointed out, NR boosted average LTVs a lot by offering Together mortgages, and they also have a higher average LTV than other institutions precisely because they grew the business so rapidly.

Average LTVs for all lenders decrease over time, as their mortgages age, values tend to increase and balances tend to fall. NR didn't have much of that benefit because they were growing exponentially - the new high LTV mortgages being added to the mix exceeded the natural ageing impact.

Jo_2k

Hi, I'm pretty sure this has already been thought of/asked but can't find a definitive answer. I took a 100% mortgage out in 2007, part of which was classed as loan. Is it possible to keep the loan with northern rock but to remortgage on the outstanding balance of the mortgage so that I wouldn't actually need a 100% mortgage again?

Thanks in advance and sorry if I'm repeating questions.

VIGILANT22

You can keep the unsecured part and remortgage elsewhere, if you can find a deal....however NR add 5/7% to your unsecured.......It might be better to find a personal loan elsewhere

b0rker

MarkyMarkD wrote: »

NRAM isn't really a "bad bank" in the sense that many people have suggested. It's bad because NR's lending on the whole was bad, not because the worst loans from NR have been moved into NRAM.

At the end of the day NR advertised themselves as a high street lender as recently as 2007. Anyone who took a mortgage out with them before or at this time took out a mortgage out with a lender who were generally considered to be successful and solvent.

It strikes me as odd that everyone who has taken out a mortgage with NR since it was discovered that they are a shower of cowboys are the ones who are possibly going to be offered a more desireable SVR.

If anyone deserves to be ripped off it is those who knowingly took a mortgage with a lender that was known to be in trouble and in massive debt.

Certainly those who innocently took out an affordable mortgage with NR at the time that they were thought to be solvent should not be punished because NR were too incompetent to run their business.

I am still not sure how I am supposed to have known that NR were likely to go under when I got my mortgage? You have not explained that one to me. It is like you are saying that it is my fault that NR went under? Of course, it must be, it couldn't be NR's fault as all banks are totally blameless according to you.

Maybe I should open up a bank, totally mess it up ending up owing the tax payer millions of pounds and then sign you up as my PR man so that you can convince all my borrowers that it was THEIR fault that the bank failed. "How do you mean it was my business plan that was at fault!?!? How very dare you. You were stupid enough to take out a loan with a bank that gave every impression of being solvent. Idiots!"

Northern Rock is already trying to take us for a ride Mark. It would be very much appreciated if you would not try and persist in your efforts to assist them.

Mark, did you have shares in Northern Rock and are now bitter that you have lost your money?

Or perhaps you are really Ron Sandler?

MarkyMarkD

NR were successful and solvent, but they had a seriously flawed business model which totally depended upon the continued availability of funding via securitisation. I have posted before that they could easily have avoided disaster by cutting back their pace of lending and keeping a buffer of funds available - hence stopping lending before "the music stopped" leaving them with a pile of new mortgages and no money to fund them.

But none of my comments suggest that NR borrowers should be "punished" and NRAM borrowers should be "rewarded". It is simply unfair, as a taxpayer, that NR borrowers should be subsidised. NR should price to reflect its risk, no more and no less. But that means pricing to generate a profit commensurate with the risk not simply operating at a break-even level.

Otherwise, taxpayers are being short-changed, and that is not fair.

NR basically does not exist. It's not a case of NR taking anyone for a ride, it is a case of taxpayers being paid a fair rate for taking on NR's risks.

Does that state my position clearly enough for you?

enay73

I am sorry to coming inside this conversation.

To be honest NR has his own fault to be in this situation but you should understand also that every single person now is stuck in NRAM due to the negligence of the NR board.
Now like myself and the others, we are stuck there because we have got a negative equity.
No one will give us a remortgage because we own more than the house actually is worthy.
The taxpayers is us including me you and anyone else out there. I don't think I am going to get something back if NR or whoever is loose the money or gain money. The difference is nothing, well zero.
Our tax are getting more higher, look the council tax, general tax, NHS costs and so on.
If you are getting to greedy you collapse the economy. I mean it's not the first time UK is in a recession.
To be honest this country would be far better if it's kept in different way.
The national interests rate is so low which anyone would be benefit from it, but they are you go, it's not.
Interest rates are quite higher than other countries because they are too greedy. That's a problems.
You know I am not even surprised if we are going to be in recession again in the future.
Other countries were in recession but at least they helped people to save their jobs, houses and so on.
Here you loose your job, then it's your problem and also if you have got a mortgage don't worry, the company will reposses your house so you wont own anything else. So awful.
Be greedy doesn't help anyone and I think in the history can tell how many times it has been done the same mistake.
That's all but honestly I don't like to see people loose their jobs and also loose their own houses after they have spent a fortune to buy their own dream homes.
Sorry again

MarkyMarkD

enay73 wrote: »

I don't think I am going to get something back if NR or whoever is loose the money or gain money. The difference is nothing, well zero.

Well, no actually. If the government eventually realises a profit out of Northern Rock's time in public ownership, that reduces public borrowing and either releases funds to pay for other things or reduces the need for taxation. Any profit doesn't simply disappear. Conversely, if NRAM is run at a loss so that the poor NRAM borrowers don't pay more than their current (actually relatively low and by no means the highest from mainstream lenders) SVR, that increases public borrowing and either absorbs funds which could be spent on other things or increases the need for taxation. Any losses don't simply disappear either!

dasilva_2

MarkyMarkD wrote: »

Well, no actually. If the government eventually realises a profit out of Northern Rock's time in public ownership, that reduces public borrowing and either releases funds to pay for other things or reduces the need for taxation. Any profit doesn't simply disappear. Conversely, if NRAM is run at a loss so that the poor NRAM borrowers don't pay more than their current (actually relatively low and by no means the highest from mainstream lenders) SVR, that increases public borrowing and either absorbs funds which could be spent on other things or increases the need for taxation. Any losses don't simply disappear either!

Do you really think that NR is going to make a profit?
In most of your other posts you have stated how bad NR lending strategy was.
(by the way I'm not some sort of cyber stalker, I just seem to commenting on the same threads as you)

semanticist

enay73 wrote: »

Now like myself and the others, we are stuck there because we have got a negative equity.
No one will give us a remortgage because we own more than the house actually is worthy.

...

That's all but honestly I don't like to see people loose their jobs and also loose their own houses after they have spent a fortune to buy their own dream homes.
Sorry again

I've been following this thread since I posted about my SVR bot on Twitter, and it's really interesting to see things like this.

I'm in a very similar position - I took out 106% mortgage in September 2007. I had negative equity from the start. It's my own stupid fault.

While I'd love for NRAM to keep the SVR low, they're not going to. They're going to be run as a business. That's not unreasonable. Really, it isn't. The government aren't running it directly, and the guy who's in charge isn't going to go 'sod it, I'll keep rates low for no obvious reason'. That would be mental.

No one 'trapped you' in a 'sub prime' lender, like I've seen people say. You took out what you thought was the best deal at the time. You probably didn't think about the consequences too much because most people do not have the slightest clue about how the financial services sector works and it's easier for them to just stick their head in the sand than try and find out. (I've worked in this sector in the past. It did leave me slightly bitter.)

If your mortgage is with NRAM all it means is that Northern Rock packaged up your mortgage and sold it on. It's not a personal slight, no one singled out your 'perfect' mortgage. The real truth is that no one at Northern Rock actually cares about you as an individual. You're not that important!

Equally, if you're 'trapped' with NRAM due to negative equity and are worried about potentially rising SVRs after a fixed rate period (exactly like me, remember) - it's your own fault. Not the government's, not Northern Rock's board's. With the possible exception of your IFA who may have mis-sold the mortgage, it's all your own fault.

Sack up and deal with it.