100% mortgage - Northern Rock dropping mortgageassets - how do we get a new mortgage?

byrnsey

And is a simple house price value rise not sufficient equity?

I.E. if the house is worth 5% more at the end of the two-year fixed rate period, can that not count towards a better rate?

Or does that entail remortgaging the house to release that equity?

Of course overpaying is THE thing to do. Alas, paying off a year-out for a masters loan elsewhere has not made that possible.

Lotus-eater

Nr's SVR is 7.59% by the looks of it, so that is what you will be paying presumably.

barnaby-bear

byrnsey wrote: »

And is a simple house price value rise not sufficient equity?

I.E. if the house is worth 5% more at the end of the two-year fixed rate period, can that not count towards a better rate?

Or does that entail remortgaging the house to release that equity?

Of course overpaying is THE thing to do. Alas, paying off a year-out for a masters loan elsewhere has not made that possible.

Yes it will count but 5% equity is still 95% LTV max which is really hard to find for a remortgage and surveyors are being ultra-cautious so may value it at no more or even less than you paid so you should contingency plan for that scenario

byrnsey

so, bottom line. Either we pay off more or we will be paying more???

Jorgan_2

Thats it, in a nutshell.

Lotus-eater

byrnsey wrote: »

so, bottom line. Either we pay off more or we will be paying more???

Thats the way mortgages work.

neas

What if your house drops in value? What would happen then?

Just a random question .

teabelly

Save like mad. If nothing else you will learn to live on less so if you can't remortgage onto a better rate you can survive on the SVR until things pick back up and you can find a better fixed rate deal.

I assume you are on a repayment not an interest only mortgage? With repayment you may at least knock off a few quid and give yourself more wiggle room. The more you throw at the mortgage now the better as in the first few years you pay large repayments and the mortgage amount owed barely moves.

mr.broderick

byrnsey wrote: »

Hi

We got a 100% two-year fixed rate mortgage with NR. It is up for renewal Feb 2009.

If NR is dropping 50% of it's mortgage assets, i.e. passing them on to other lenders so they can make back the money to pay the Govt, then of course we will be asked to go elsewhere for a mortgage in Feb 2009.

But we had to go with NR because no other banks were giving 100% mortgages then, so our fear is that with the current market - and probably worse in six months - they wouldn't go near us.

Would our only hope be that if our house value has risen by 3-5% that would count as 5% investment?

Any advice or thoughts on this very welcome.
I don't think I am mad in thinking the banking/lending sector as a whole in the UK can only get worse before it gets better.

Adrian

Just post them the keys and b.ugger off to benidorm for 6 months.

dekh

Read the terms of your mortgage before you overpay too much, lenders may charge you extra if you pay too much.

If you will suffer penalties for overpayment, save in an account that pays well but allows you to get the money in Feb next year to put towards the next mortgage if you have to.

All is not doom and gloom, unless NR makes it's base rate highly unattractive, (which is a distinct possibility), hopefully your personal finances will have improved in the next 11 months that going onto their variable rate - which is the worst that could happen - might not be too painful.