Northern Rock End of Mortgaged Deal (Merged Threads)

niccatw

Jonesy - I'm with deedee. If your debts are higher interest rate than your mortgage, pay thm off first.

Stevie I've been overpaying the unsecured part of my mortgage. As Thrugilmir says, the interest rate is the same, but once it is gone, it means I can look at moving without worrying about having to leave the unsecured bit with NRAM. It also makes more sense to me in terms of me working out what my next move is as I'll have a better idea of what my LTV is, what the SVR is at that point in time and what options are available to me.

badobsession81

Hoping someone can help point me in the right direction...

Been reading this thread and credit card threads with interest as me and my fianc! are in a similar position: NRAM 125% mortgage on SVR (4.79 I think), with personal loan and CC debt. Have basically maintained debt levels since taking the mortgage out in nov 07 (right on top of the NR issues) and want to thoroughly review spend etc. Particularly as we've both secured more income/better jobs in the last year. A lot of our considerations are about getting us into as best a position as possible to be able to move in the next couple if years and wonder if this changes how best to direct our money to debt etc.

Any help greatly appreciated. Should I be starting a new thread somewhere?

Thanks

spidermev

Thrugelmir wrote: »

Repay the unsecured loan first. The interest charge is the same so the interest saving is identical. Then you'll be able to measure how well you are saving.

Whilst I do not disagree with that, I'm struggling to understand what difference it makes whether you overpay the secured or unsecured loan. Surely if you overpay enough to clear the unsecured loan, had you overpaid the secured part you would then have enough equity on a sale to clear the unsecured part anyway? You wouldn't want to drag that hideously high interest unsecured loan around unnecessarily after you have sold the house :eek:
Wouldn't the end result be the same?
I'm particularly interested in this as I overpay monthly and haven't specified to which part as I couldn't see a significant difference

Thrugelmir

spidermev wrote: »

I'm particularly interested in this as I overpay monthly and haven't specified to which part as I couldn't see a significant difference

My comment was made from a physcological view. As by reducing and clearing a smaller balance there's an achievable target. A goal to reach.

Paying down the main mortgage will seem like treading water. Going now where fast.

spidermev

Ah ok, I see what you mean

Thrugelmir

spidermev wrote: »

Ah ok, I see what you mean

There's an old Chinese proverb.

A man who wishes to move a mountain starts with the smallest stones first.

skinnybowler

I always make overpayments to the secured part rather than the unsecured part of my Together mortgage. As spidermev states, there is no difference which you use overpay to in terms of how much you will owe NRAM, but there is a crucial difference.

Overpayments made to the secured part can be withdrawn at any time (minimum of £500). Overpayments to the unsecured part can't (you would need to enter into a new credit agreement with NRAM, and they do not offer new credit).

spidermev

Thrugelmir wrote: »

There's an old Chinese proverb.

A man who wishes to move a mountain starts with the smallest stones first.

I like it :beer:

stevie_p_3

thanks for the comments, i was going to just start overpaying on the unsecured but now i see that i can overpay on the sercured and switch it to the unsecured when i have paid enough to clear it, whilst also having the security of withdrawing the overpayments for an emergency.
does anyone actually know how easy it would be do withdraw any overpayments from NRAM if needed??

spidermev

As Thrugelmir said earlier, you should build an emergency stash.

I wouldn't rely on other peoples opinions on how easy it will be to get overpayments back. Other people may say it's dead easy but what if for some reason your application is delayed or even denied. :eek:
I wouldn't risk it. Have a couple of months worth of wages (if possible 3-6 months) in an easy access savings account or even a cash ISA. If you never use that money you will have started off your new savings habit already :money: