Northern Rock End of Mortgaged Deal (Merged Threads)

Crokeria

Can anyone tell me if its better for me to overpay on my interest only NR mortgage....or to stick the overpayment in an ISA? I owe NR £110k but I cannopt afford repayment on the SVR and cannot remortgage due to credit history. So to recap, does it make sense to overpay on interest only?

TwelfthMan

Crokeria wrote: »

Can anyone tell me if its better for me to overpay on my interest only NR mortgage....or to stick the overpayment in an ISA? I owe NR £110k but I cannopt afford repayment on the SVR and cannot remortgage due to credit history. So to recap, does it make sense to overpay on interest only?

What is the NR interest rate??
What is the ISA interest rate??

If the NR rate is higher then overpay.
If the ISA rate is higher then deposit the money in the ISA. Bear in mind the ISA deposit limits.

loopydonna

MarkyMarkD wrote: »

All I can do is point out that if your payments on SVR are too high, you should have taken a longer term fixed/discounted/tracker rate in the first place.

How do you know that people's circumstances haven't changed in the mean time?

I took out a 10 year fix 9 years ago. We both had well paid jobs then and going onto SVR was easily affordable. Over time, he has left me with children and I took the mortgage on in my sole name.

When my fix rate runs out next year, it's going to be a huge jump onto SVR, and I'm only working part time now due to the children, so I haven't got the income multiples to move elsewhere.

neverdespairgirl

beingjdc wrote: »

What I will say again though is that after this period of shameful ramping by estate agents, banks, TV channels, etc, is that for at least a limited period anyone on a residential mortgage at over 100% LTV (when taken out, not including people who have 'withdrawn equity' to go on a cruise!) should be allowed to walk away and call it quits.

WHy should the taxpayer, who acted in a prudent financial manner, subsidise people who chose not to be careful?

neverdespairgirl

Crokeria wrote: »

I agree Kinkango. NR do not, and have never done sub prime! Don't lump those of us with 100-125% mortgages as sub prime!

I'm sure you did have to have a good credit rating, but nevertheless, more than 100% LTV seems like sub-prime to me.

In any event, NR definintely did sub-prime. I remember seeing a link on their website for brokers to click on to arrange mortgages for sub-prime borrowers - in September 2007!

SkintKlint

Has anyone seen this Northern Rock Mortgages news story?

It's saying that "...Northern Rock's collapse was caused by the War in Iraq. Not by sub-prime mortgages, not by liar loans, not by people who signed up for loans they could not afford, not by borrowers who misrepresented their income and assets..."

Sounds to me like neither of the above were the reason for the collapse - They were borrowing over 3 months and loaning it out again for 25 years... What did they think was going to happen!

MarkyMarkD

Loopydonna You make a very fair point. But most of those complaining about "being forced onto SVR" are those who bought short-term fixed/discounted rates - mainly 2 years - on the assumption they could keep switching and never pay SVR. That's completely different to someone like you who made an initially prudent decision by fixing for 10 years, and has then been caught out by circumstances.

But in your circumstances, you can doubtless remortgage elsewhere as you will have lots of equity in the property.

Those other complainers are typically stuck with NR because they initially borrowed over 100% and can't get an equivalent product elsewhere.

Skintflint The popular notion that "borrowing short and lending long" was the cause of the NR situation is rubbish. All lenders borrow short and lend long. A building society, 100% funding its mortgages from savings accounts, is borrowing all its money short and lending it all long.

There's nothing wrong with that, unless those lending the money - whether savers or institutional investors or other banks - stop wanting to lend. It is that, which is a result of the global credit crunch and nothing to do with the war in Iraq, and nothing to do with "borrowing short and lending long" per se, which led to NR's problems.

SkintKlint

MarkyMarkD wrote: »

Skintflint The popular notion that "borrowing short and lending long" was the cause of the NR situation is rubbish. All lenders borrow short and lend long. A building society, 100% funding its mortgages from savings accounts, is borrowing all its money short and lending it all long.

There's nothing wrong with that, unless those lending the money - whether savers or institutional investors or other banks - stop wanting to lend. It is that, which is a result of the global credit crunch and nothing to do with the war in Iraq, and nothing to do with "borrowing short and lending long" per se, which led to NR's problems.

I agree - perhaps I was too simplistic in my opinion... You're absolutely right, but should there not have been more of a contingency?

star69_2

Hi

Please someone explain to me this...

Me and my partner have 75k mortgage with NR - 66K mortage and 9k unsercured loan,

Our deal comes to an end in Jan 2009, so it is a long way off ,but i'm confused.

When we come to re mortgage will i be able to pay NR off if i get approved for another mortgage in full. Our house i believe is worth around 88k and since we bought it i have greatly improved my job and pay, Or will i have difficulty in finding a new mortage that will let me pay off in full including the unsercured part?

Please help , be gentle..

Thanks:A

poppy10_2

star69 wrote: »

Me and my partner have 75k mortgage with NR - 66K mortage and 9k unsercured loan,

When we come to re mortgage will i be able to pay NR off if i get approved for another mortgage in full. Our house i believe is worth around 88k and since we bought it i have greatly improved my job and pay,

If your house is still worth 88k or higher in 2009, you should have no problem remortgaging at that point. The again, things are so turbulent at the moment, it's impossible to predict what the situation will be in June 2009.