Help with re-mortgage please

olliesmummy06

Hiya, weve got a mortgage with Northern Rock which will come to the end of the 2 year fixed we took out, also a loan with them (we took them out the same time when moving house) and recently a secured loan with First Plus....not good i know but we got the house at a fab price but it needed quite a bit of work to it.

My question is what is the best thing to do....add the secured loan to the mortgage and switch lenders leaving the loan with NR or add the mortgage and the unsecured loan with NR and switch?

Mortgage with NR-£118,000 oweing @ 5.89% paying £663p/m-33 years left
Loan with NR-£19,000 oweing @ 6.89% paying £105p/m-33 years left
First Plus secured loab-£20,000 oweing @ 10% paying £175p/m-25 years left

I know the years are high but im only working part time til our ds goes to school in 2 years time then ill go back full time and we should be able to pay it off apx 15 years earlier.

Im thinking its prob best adding the NR and secured loan together and getting a new mortgage for £138,000 and leave the loan with NR-we won't be able to add all 3 together as house is worth a min of £155,000 on standard valuation-sold i was told by FP (apparentluy they check house prices on net and use them) and don't want to take a mortgage for over 100%.

Any ideas????????????

Thanks in advance, xx

wheelies_3

I'm afraid I can't answer your question but I'm glad I'm not the only who is confused by this when you have bits added onto the mortgage on one way or another.

Best of luck whatever you decide to do

farhad1965

olliesmummy06

Is your property possibly worth more than £157K that you owe in debt? You say No, but get a valuation or do something without much cost that takes you to £160k.

Are the loans OK to pay off without any/much penalty?

If the answer is positive to these, If I was in your shoes I would try and get them all together as one mortgage loan, where you will be paying much less interest all around.

Then if you can still pay £663+£105+£175 per month, I would do so, so that you pay off your debt quicker.

If your property value is around £155k, then what you suggest makes sense. But do think about moving the NR loan if you can find a lower % rate.

Good luck

olliesmummy06

Thanks for that farhad1965-we're pretty sure our house would sell for £165k+ but when i spoke to FP they said they just check the net for prices and in our area the average is £155k so im not sure what mortgage providers would do, if they actually come round or drive past i would imagine it would be more than the £155k. I agree it would be better for us to put all 3 together-fingers crossed. Think i'll have a look around at rates and contact some companies.

farhad1965

For a mortgage like yours where the Loan To Value % is pretty high, the new lender would arrange for a proper valuation and that includes internal survey.

In the past when my outstanding loan on remortgage was something like 25-30% they only did a drive by.

Farhad

susanmarie

I its a bad time to be re-mortgaging - as all the best deals are gone, would it not be cheaper (taking in to account arrangement fees, HLC's etc) to pay the lenders standard variable rate for a short time to see how the credit 'crisis' pans out?? What you don't want to do is re-mortgage for more than your property can potentially sell for as you put yourself at greater risk or repossession and / or mortgage shortfall.