Northern Rock End of Mortgaged Deal (Merged Threads)

tony863

Please, can anyone advise?:(

dgl1001

1) no
2) don't know
3) try it, but i doubt they can do anything

tony863

Thanks for your advice...I think!

I didn't want war and peace, but I was expecting a little more

Nevertheless, thanks anyway

adrian2000

I currently have a Mortgage with the Northern Rock which the deal is coming to an end.

I took it out 7 years ago in June 2002 at a rate of 1.89% fixed for two years. After the two year period it reverted to the standard variable Mortgage rate.

I was tied into Northern Rock by a redemption penalty which year on year reduced in the last year to about £400. As part of their commitment to me the rate had a base rate guarantee of 1.99% above the BOE mortgage rate so now I am paying 2.49%. This however comes to an end in June this year and will revert to their standard rate of 4.79%, this may be reduced slightly by 0.25% as a loyalty discount.

I have phoned the Northern Rock to see if they have any deals to offer me, but they don't at the moment, so I have been on the look out for a deal to suit me.

I am currently over-paying and want to continue to over pay, whilst I can, but want to get a better rate, so I have looked round and found a couple of rates that I think are quite good, but want to get other peoples opinions on them?

The first one is with the Principality BS at a capped rate of 2.99% this is capped for two years then reverts to their standard rate of 4.99% . They pay most of the fee's including Valuation and solictors fees etc. I can also overpay as much as I want without any penalties.

The second is with Stafford Railway BS at a variable rate of 3.69% again most of the fees are paid by the BS with the execption of the valuation fee of about £230 and a conveyancer fee of £145. There are no early repayment charges, I can also overpay as much as I want without any penalties.


Can you please let me know what you think or if you know of any better deals out there?


Thanks
Adrian

discostu1978

if the value has gone down by £15k, you'll probably be in about £30k of negative equity, meaning moving to another mortgage provider is not an option.

so to answer:
1) not a chance i'm afraid.

2) it may drop another 0.5%, but no more than that. The only way it is going to go is up. Before rates started dropping in Oct last year, the SVR was about 7.6%. That said, its unlikely that rates will go up much in the short term (i.e next 6 months)

3) no - they won't be able to get you anything. They may tempt you to leave the unsecured part of the loan with NR (the together mortgage is actually part mortgage and part unsecured personal loan). If you do this NR would put the interest rate up significantly on the unsecured bit (to about 12-13%). But to be honest, if the value has gone down as you say, you won't have enough equity to be able to get a fixed rate even with just the secured part of your existing loan..





In MY opinion, you are best off staying with NR for now, and overpaying on your mortgage as much as you can. Even £50 a month will make a difference.


Hope this makes sense? Sorry its not better news, just hope for a bit of a recovery by the end of the year in the market.

tony863 wrote: »

I don't want to butt in on the argument or discussion or whatever you want to call it, but I have a question to ask and would like it if anyone can offer any advice. My situation is like many others in that:

I am with NR and have been since May 2007 when me and my wife bought our house for £167,000. We did the old together mortgage and borrowed a further £14,000 to settle old debts and pay off the other bits and pieces.

We fixed the mortgage at 5.85% for 2 years which is due to end this May and I'm aware that the SVR is about 4.79%.

Having had a look at the market in my area, my house has depreciated by approx £15,000, based on the fact that one is up for sale in my street, same spec, for £155,000.

NR have already sent us numerous letters telling us that they will not be renewing our mortgage, so I would like to know the following if possible:

1. Will we be likely to be able to re-mortgage anywhere else and get a fixed rate at better than NR's SVR?
2. How long will NR's SVR stay at that rate and is it likely to drop further or go up in the near future?
3. Is it worth me ringing an independant financial advisor?

Any other advice would be greatly appreciated.

tony863

Many thanks for taking the time to respond to my question. I agree that it isn't good news, but at least I know what is coming.

Thing is, I really can't see us ever getting away from NR until the market picks up again and by then we might be priced out of the market.

Incidentally, what is the benefit of overpaying on our mortgage?

MarkyMarkD

Overpaying is worthwhile if the mortgage rate is higher than you can earn on any savings (after tax, if they would be taxable). So if you are paying SVR, you are very unlikely to beat that on a savings account.

Overpaying reduces your balance and hence either your future payments or the time it takes to pay it off - or to make it remortgagable, which is probably most relevant for you.

Otherwise, as you say, you will probably be stuck with NR forever.

discostu1978

the vast majority of your payment each month at this early stage of a mortgage is interest. therefore if you overpay, its directly reducing what you are owe, and therefore you save on the interest.
The great thing with Northern Rock is that you can get the overpayments on the secured part of the loan back within 24 hours. I've ploughed all my savings into my mortgage, and can pull them back if i really need to.

to see how much you can save by overpaying, check these calculators:
http://forums.moneysavingexpert.com/showthread.html?t=155707

i reckon i can save 80k in interest over the life of my 250k mortgage with my current overpayments, and over 8 years!!

thisisballs

I have a fixed rate due to finish in June 2009. When I took the mortgage I also took up their offer of a £1000 contribution to costs. This would be repaid by me only If we leave NR within 6 months of the fixed rate finishing. Northern Rock have always been competetive in the past so I didn't worry too much about accepting the offer.

Now they have written to say they won't be offering any new deals and of course their rate is uncompetetive as they have taken the decision to run down their mortgage business. This virtualy forces me to leave and of course to repay the £1000. I'm not usre it's fair, any one got any views?

Mary_Hartnell

You, I and every citizen in this country is feeling the "hidden hand" of economics; in the land of devalued currency and monetised government debt.

Caveat emptor; NR seemed like a good deal at the time and I expect you were pleased .

http://en.wikipedia.org/wiki/Caveat_emptor

Our creditors are getting tired of the promissory notes they are being given.
We all need to sacrifice at least 10% of our living standards - and all this because of a man made fiasco created by politicians & wally bankers.
The real physical problems of depleted resources per head and global warming have yet to be addressed.
Look at the bright side. The government is sacrificing our children & pensioners on your behalf.
You might have put the 1000 pounds into an off shore account with an Icelandic bank or ordered a top of the range suite from Land of Leather?