Northern Rock End of Mortgaged Deal (Merged Threads)

dmhuk2001

Yes, the early repayment costs (erc) are a big headache and take quite a chunk out of any money made from selling a property, especially considering the current market, and the need to have around 20%+ deposit to obtain a new mortgage at a half decent rate, especially if you want a more family sized home. Currently it would be difficult to even legitimately rent out a property as rents are so low compared with what ratio the bank expects and because transferring to a interest only mortgage, as some have to in order for NR to allow them to rent thier property, now seems impossible if xferring onto new products is now not possible.

Bradford and Bingley customers were apparently able to settle their mortgages without paying the erc's as B&B wanted rid of its lending. NR have shown no sign of considering this previously but as this is a Government owned bank, and the "bad" part presumably is not aimed at NR's traditional profit at any social cost, but instead in steadily running down the lending on its books, which is already significantly bailed out by we the public, I will ask NR why it wants to charge these extortionate costs which were barely acceptable in a high market, let alone now and from a publicly owned entity such as it is. I know, I know, but even agreements entered into freely can become unfair or punitive over time and perhaps its the case here.

I am also surprised noone has come up with an alternative model for housing buying to mortgages after all of this anyway. They seem a silly way of funding a new home which, by their very nature weave between ridulously expensive for the those less able to pay, to pushing up costs of purchasing a home and to push housing prices ever up without regard to realistic price or value - it's almost comparable to a massive pyramid scheme and confidence trick. A more creative approach needs to be taken surely, preferably avoiding greedy reckless bankers!

MarkyMarkD wrote: »

Whether you have a mis-selling case, dmhuk2001, depends on the circumstances. There was never an implicit guarantee that - without any conditions - you could borrow more money when you ported your mortgage. That additional borrowing - and indeed the entire new loan - would always have been stated as being condition on lending policy at the time of the new loan.

If your credit situation is better now, than when you first took the mortgage out; and the additional borrowing is more than covered by a proportionate increase in your earnings; then you have slightly more of a case. But lenders are still free to tighten their lending criteria at any time - even to the extent of not lending at all - and that does not mean that they have breached their original portability guarantee.

If you are a decent risk, I don't understand why you would want to port an NR mortgage anyway, because you should be able to get one far cheaper. And that applies even if you are currently subject to an ERC - the ERC is likely less than the savings you will make by remortgaging away from them.

catpaws99

NRAM also. 90% ltv. Have 18 months left on my fixed rate. Am not really too worried who I am with - oh has recently gained a ccj and so moving to any competitive deal would be impossible. Just pleased to have a roof over my head that I can afford.

gardnt1

I'm with NR plc for mortgage and NRAM for unsecured car loan.

Mortgage has been with them for 12 years, 13 left, fixed at 4.99% til
end. Some additional borrowing at SVR, but LTV around 60%

dgbeale

Sorry , I can't help my posting history - actually I can, by replying to silly comments like this.

Now does that make me more credible?

b0rker wrote: »

I will wait for someone with a posting history and a 75% LTV to say that they have been put with NRPLC before I get miffed...

MarkyMarkD

dmhuk2001 wrote: »

Yes, the early repayment costs (erc) are a big headache and take quite a chunk out of any money made from selling a property, especially considering the current market, and the need to have around 20%+ deposit to obtain a new mortgage at a half decent rate, especially if you want a more family sized home. Currently it would be difficult to even legitimately rent out a property as rents are so low compared with what ratio the bank expects and because transferring to a interest only mortgage, as some have to in order for NR to allow them to rent thier property, now seems impossible if xferring onto new products is now not possible.

Bradford and Bingley customers were apparently able to settle their mortgages without paying the erc's as B&B wanted rid of its lending. NR have shown no sign of considering this previously but as this is a Government owned bank, and the "bad" part presumably is not aimed at NR's traditional profit at any social cost, but instead in steadily running down the lending on its books, which is already significantly bailed out by we the public, I will ask NR why it wants to charge these extortionate costs which were barely acceptable in a high market, let alone now and from a publicly owned entity such as it is. I know, I know, but even agreements entered into freely can become unfair or punitive over time and perhaps its the case here.

I am also surprised noone has come up with an alternative model for housing buying to mortgages after all of this anyway. They seem a silly way of funding a new home which, by their very nature weave between ridulously expensive for the those less able to pay, to pushing up costs of purchasing a home and to push housing prices ever up without regard to realistic price or value - it's almost comparable to a massive pyramid scheme and confidence trick. A more creative approach needs to be taken surely, preferably avoiding greedy reckless bankers!

I'm honestly not sure what you are blathering about now, dmhuk2001, in your final paragraph.

There was nothing to stop you - or any other borrower - borrowing on a mortgage with no ERCs at all. Many, many lenders offered them. You CHOSE to have a mortgage with an ERC, because you liked the other terms of the deal. That's life - every contract you make has some good features and some bad features.

Some may choose to fix their mortgage rate for the entire term - say 25 years - because they have absolute certainty about outgoings, and because they don't care about ERCs because they never intend to move.

Others may take the diametrically opposed position and choose a variable rate throughout the term, because they are very concerned about the implications of ERCs.

The problem with ERCs is that any portability conditions included upfront are actually meaningless as they are never, ever, binding on the lender in any meaningful way. So any mortgage with an ERC is a risky proposition - and you should not buy it unless you are TOTALLY confident that you will not need to settle early.

I have, personally, had many mortgages with ERCs - some fixed, some discounted - and I currently have a mortgage with no ERC but which I've ported when I moved house because the rate is so good. I'm not saying I've always done the right thing - I once had a fixed rate mortgage at 11.95% with ERCs - but equally well, I didn't cut up rough about the unreasonableness of either the rate I was paying or the ERCs to get out of it. In fact, once I even voluntarily paid an ERC because it was in my financial interest to do so.

teezie

We took out a NR together mortgage almost 4 years ago, whereby basically the 'deposit' which we didn't have at the time was an unsecured loan also from NR. we came to the end of our deal after 2 years. We were led to believe from the IFA that the unsecured loan part was only spread over 5 years. Of course since the statements came in we've realised that the unsecured loan is the same length as the mortgage (30 years) and accumulates interest at the same rate as well (where as with a normal unsecured loan, the interest is added on at the beginning), we were led to believe that after 5 years we would be left with a mortgage only, instead we are left with a bad credit history.... I personally have zero debt apart from the "mortgage" and yet my credit rating wont allow me a store card with a limit of £120... is there anything we can do?

picardygirl

Keith wrote: »

He's moved to a new product which would be new lending so would stay with NR.

I understand that ....... we signed a 5 year deal just over 3 years ago ........ under 70% LTV ...... i wonder now if we had signed a 3 year deal (would have been due for MR in September 2009 then) if we would have been retained by NR plc ..... but then again we'll never know will we!

VIGILANT22

teezie wrote: »

We took out a NR together mortgage almost 4 years ago, whereby basically the 'deposit' which we didn't have at the time was an unsecured loan also from NR. we came to the end of our deal after 2 years. We were led to believe from the IFA that the unsecured loan part was only spread over 5 years. Of course since the statements came in we've realised that the unsecured loan is the same length as the mortgage (30 years) and accumulates interest at the same rate as well (where as with a normal unsecured loan, the interest is added on at the beginning), we were led to believe that after 5 years we would be left with a mortgage only, instead we are left with a bad credit history.... I personally have zero debt apart from the "mortgage" and yet my credit rating wont allow me a store card with a limit of £120... is there anything we can do?

teezie

Quote: instead we are left with a bad credit history

A Together mortgage does not give you a bad credit history. You could have set up the unsecured part for 5 years, this was an option with NR. Did you not check you paperwork when this was sent to you/issued to you. Why don't you overpay the unsecured part and get rid of it? This is an option, you are not obliged to have it as the same term as the mortgage.

A bad credit history is due to how you conduct your credit ie late payments, missed payments etc....

picardygirl

semanticist wrote: »

My fixed rate (currently 6.9%, taken out six weeks before NR collapsed) is up in August 2012. Obviously I'm with Northern Rock Asset Management like everyone else.


.

Keith - Its obviously not as clear cut as new customers or existing customers accepted on new deals (ie, in the last few months) get retained by NR ...... sounds like semanticist took out his mortgage November 2009 and is still with NRAM .......... so they obviously passed their credit scoring/affordability etc etc in November 2009 yet not deemed "good enough" to be retained by the company that gave him a mortgage 6 weeks earlier .......

Alisonb1975

I have also had a letter a few days ago saying that we have been moved to the asset management part of the business! We have overpaid for a while and have never missed a payment in neary 8 years.

Our current 5 year fixed rate is at 5.39% and will finish shortly. Our mortgage is £61000 and our house is worth £150000 (ish) so we should have a few options available which I have been looking into. I am wondering if people have been offered any good deals to stay with them?