Northern Rock End of Mortgaged Deal (Merged Threads)

jon2322

tylersbabe wrote: »

.......................

Thought provoking, essentially you are saying what?

mel_mel

Hi everyone. I need some advise about Northern Rock. My sister died last August and she had a mortgage with N/R. She was divorced and left 2 sons. One had left home the other is still there. He is 20 and not in full time work. I rang n/r when she died and deferred payments for 6 mnths. That time is now coming to an end. She used to pay her mortgage from her DLA and income support topped it up. I don't know what to do as I took my nephew to a solicitor to find out if both the boys were entitled to stay in the house (there father want nothing to do with them) and they have found out that yes they have got the house. But they cannot afford the mortgage and I would hate to see them homeless. I said I would pay it each month for them and come to some arrangement with n/r. But because of all the implication with n/r, I don't know what to do. I am willing to pay it for them, so it doesn't get repossessed, but I have no idea about these things at all. I have read these threads and people saying swap it to somewhere else, fixed rates, bank of england base rates etc, but can't understand a word of it. Basically if I decide to ring n/r and say I will pay their mortgage, is that a good idea or what should i ask, should I ask about reduced payments or what. Thanking you for any help you can give me. Marie

agbs3

mel_mel wrote: »

Hi everyone. I need some advise about Northern Rock. My sister died last August and she had a mortgage with N/R. She was divorced and left 2 sons. One had left home the other is still there. He is 20 and not in full time work. I rang n/r when she died and deferred payments for 6 mnths. That time is now coming to an end. She used to pay her mortgage from her DLA and income support topped it up. I don't know what to do as I took my nephew to a solicitor to find out if both the boys were entitled to stay in the house (there father want nothing to do with them) and they have found out that yes they have got the house. But they cannot afford the mortgage and I would hate to see them homeless. I said I would pay it each month for them and come to some arrangement with n/r. But because of all the implication with n/r, I don't know what to do. I am willing to pay it for them, so it doesn't get repossessed, but I have no idea about these things at all. I have read these threads and people saying swap it to somewhere else, fixed rates, bank of england base rates etc, but can't understand a word of it. Basically if I decide to ring n/r and say I will pay their mortgage, is that a good idea or what should i ask, should I ask about reduced payments or what. Thanking you for any help you can give me. Marie

Without meaning to sound rude - Have you checked all the life insurances etc as its very rare to have a mortgage without one which means the house should be paid off - if i die for example my house is paid off and my G/friend is mortgage free and keeps the house. Might be worth checking to see if she had anything in place.

MarkyMarkD

b0rker wrote: »

MarkyMarkD wrote:

You can't remortgage with the same lender. It's not a remortgage - it's a product switch.

And NR shouldn't be throwing away taxpayers' money by reducing rates for those who are stuck on their SVR. If they are stuck, because nobody else will lend to them, then they should be paying a premium rate to reflect the risk involved.

I can see you're eager for there not to be assistance for existing customers seeking new deals with NR but sadly you have got all your facts wrong:

From the BBC website:

http://news.bbc.co.uk/1/hi/business/7904748.stm

Chancellor Alistair Darling also suggested that some mortgages would be lent at up to 90% of the value of the property being bought.

I'm not sure which "facts" I am supposed to have got all wrong.

I have only stated one fact - you cannot remortgage the same house. That's a fact. You can only remortgage by changing lenders - that is the definition of a remortgage. Switching products with the same lender is a product switch, not a remortgage.

Everything else I've said is opinion, not fact.

I don't quite understand the relevance of the BBC link which doesn't mention the word remortgage and hence doesn't contradict any fact I've stated.

mel_mel

agbs3 wrote: »

Without meaning to sound rude - Have you checked all the life insurances etc as its very rare to have a mortgage without one which means the house should be paid off - if i die for example my house is paid off and my G/friend is mortgage free and keeps the house. Might be worth checking to see if she had anything in place.

As far as I can tell she didn't have any. I couldn't find any papers and nothing was going out of her bank account to pay anything.

b0rker

MarkyMarkD wrote: »

You can't remortgage with the same lender. It's not a remortgage - it's a product switch.

And NR shouldn't be throwing away taxpayers' money by reducing rates for those who are stuck on their SVR. If they are stuck, because nobody else will lend to them, then they should be paying a premium rate to reflect the risk involved.

I can see you're eager for there not to be assistance for existing customers seeking new deals with NR but sadly you have got all your facts wrong:

From the BBC website:

http://news.bbc.co.uk/1/hi/business/7904748.stm

Chancellor Alistair Darling also suggested that some mortgages would be lent at up to 90% of the value of the property being bought.

If you cannot see the discrepancy between what you have claimed that NR are doing and what Alistair Darling has actually said that they will be doing then I am not sure I can help you with your inability to distinguish what a fact is. Your opinion is fact?

Either than or you haven't worded your post at 23-02-2009, 8:38PM clearly enough to identifty your point. As it came straight after a post about NR announcing fixed rates to current NR mortgage holders I assumed you may have been staying on topic and not just making some random anti-NR mortgage holder comment.

This thread is here to help people who's NR mortgages are ending. If you want to give your opinion on how we are all bringing the country to it's knees then you have the recession forum for that.

Mary_Hartnell

I've looked through the link to the story about Northern Rock.
I agree that now Northern Rock is getting down to the hard core of "can't leave" mortgagors who are the:
Nearly 3% of /B]NR[B borrowers are in arrears by more than three months, up from less than 2% last September.

....particularly /B]the borrowers[B who had been given 125% loans under its notorious "Together" mortgage policy.

So it makes sense to rebuild NR's mortgage book, with nice clean folks buying cheaper houses and putting down a 10% deposit for an "up to 90% LTV". I have a vision of a doctor married to a senior tax collector - they probably won't default or be made redundant. [ I have an "....up to 8Mb" internet connection:rolleyes:].
It also makes sense to try to keep the regular payers who have steady jobs with prospects.

That way the politicians might be able to flog off NR and get the dead weight off the public borrowing requirement; which is currently making the whole country look like a 125% borrower.

However there is not much point in putting off repossession of those who self evidently cannot cope, by throwing good money after bad.
In the last recession, the major reason for repossession (at Bristol & West where the analysis was done) was not redundancy, divorce, illness - it was the inability of the borrowers to face the facts and budget or sell before it was too late.
The worst hit were the white collar workers hit by the recession: Those working for architects, builders, solicitors,.....................

MarkyMarkD

I still don't understand what b0rker is on about, having read the posts several times.

What precisely am I getting wrong?

All I've said is that, if NR are offering deals to existing borrowers on SVR who cannot remortgage elsewhere because of their LTV, they shouldn't do so. That's just p1ssing taxpayers' money away.

Neither should they be charging an SVR as low as 4.79% to such borrowers. They should be charging a sensible risk-adjusted SVR. Given that nobody who is a decent risk would stay if they set their SVR at - say - 7%, I don't understand why they have reduced their SVR at all since they have been nationalised. There is no commercial logic for it - they are simply throwing taxpayers' money at borrowers.

News articles about NR offering 90% mortgages to new borrowers have nothing to do with what I would be complaining about, if indeed NR are doing it.

And if they are not, that's fine.

b0rker wrote:

This thread is here to help people who's NR mortgages are ending. If you want to give your opinion on how we are all bringing the country to it's knees then you have the recession forum for that.

No, as with most threads on MSE this thread is for anyone to say whatever they like, about whatever they like.

Nonshy

MarkyMarkD wrote: »

I still don't understand what b0rker is on about, having read the posts several times.

What precisely am I getting wrong?

All I've said is that, if NR are offering deals to existing borrowers on SVR who cannot remortgage elsewhere because of their LTV, they shouldn't do so. That's just p1ssing taxpayers' money away.

Neither should they be charging an SVR as low as 4.79% to such borrowers. They should be charging a sensible risk-adjusted SVR. Given that nobody who is a decent risk would stay if they set their SVR at - say - 7%, I don't understand why they have reduced their SVR at all since they have been nationalised. There is no commercial logic for it - they are simply throwing taxpayers' money at borrowers.

News articles about NR offering 90% mortgages to new borrowers have nothing to do with what I would be complaining about, if indeed NR are doing it.

And if they are not, that's fine.

No, as with most threads on MSE this thread is for anyone to say whatever they like, about whatever they like.

So you are suggestion NR have an SVR of about 7% (offering a "risk-adjusted" SVR would never happen)?

The "logic" behind this would be???

That SVR would cause thousands of people to be in severe difficulty with no chance of paying their mortgage on a consistent basis and with the likelyhood of negative equity and inability to sell the house would mean a long drawn out process to reclaim the property at a lesser value than the mortgage!

Plus when people who could move away after their deal ended they would... no one would stay on that rate, except those that can't move.... keep all the bad mortgages eh!?

Then you'd have the scenario of new customers opting away from NR as their SVR is outrageously high in comparison to other lenders....

All would lead to no retention of the good mortgages, no new customers, bad public image and reputation.... a small mortgage book full of bad debt!

MarkyMarkD

NR isn't likely to be sold off in any "going concern" form, so leaving it with all the "bad" mortgages isn't an issue per se.

The US, for example, is quite happy with the concept of a publicly-supported "bad bank" with all the bad loans in it. It makes a lot more sense than leaving NR as a mixed bag of good and bad debt - which still probably won't be attractive enough for someone else to buy.

As with most government "thinking", the strategy has been completely changed half-way through.

The original plan was exactly as I would have expected - and desired - it to be - keep the rates high, encourage everyone to leave who can, and keep the dodgier loans but paying an acceptable rate.

Instead, the government lost its bottle, started reducing SVR to silly (relatively low) levels and making it not so bad for most customers to stay - even if they didn't actually have a choice.

Let me issue a challenge for the avoidance of doubt on my position - can anyone who is in negative equity with NR genuinely claim that 4.79% is a realistic rate to be paying on what is unsecured debt? Can anyone get an unsecured loan elsewhere at 4.79% without any fees?

I don't think so!