Remortgage after Northern Rock

barnconverter

Our two year fixed rate comes to an end on the 1st May with Northern Rock and like others on this forum, NR made it clear that they are not competitive and suggest talking to a financial advisor which we have done.

We are looking for a self cert mortgage as we have a business and after speaking to our F.Advisor today, it would appear that deals are disappearing by the day. He feels that the market is being 'talked down' and things haven't been this bad in ten years! As we do not want anything more than a two year 'tie' to either a fixed rate or preferably a base rate tracker (as we feel that rates will come down in the next 2 years) we are wondering if this situation may settle down in a couple of months time (i.e. more money around and more deals at lower rates) and whether it is worth staying with the N.R for the next couple of months (even though their Variable rate is ridiculously high) in the hope of a better rate in the summer? I know none of us have a crystal ball, but would be interested on your comments.....

beecher

I think it'll get worse before it gets better, but maybe it is worth looking at a lifetime tracker somewhere, where you have the ability to fix if and when you wish to? As long as you're not subprime, then I'm not sure what advice can be given.

barnconverter

Thanks for your comment. What does subprime mean?

owitemisermusa

High risk borrower - the sort who (in the past) did not have the ability to pay but got the loan regardless.

Another way to put it, have a chequered credit history and so presents a greater risk to the mortgage lender.

barnconverter

Thank you. No, we would not be considered Subprime.

herbiesjp

Why self cert?

Having a business does not automatically mean a self cert mortgage.

If you have a track record then you could get standard high street rates

barnconverter

The problem we have always had, is that if you are PAYE and apply for a 'conventional mortgage', the lenders only look at the regular debits from your account when calculating affordability i.e. credit cards, council tax etc., with the business, a lot of 'everyday' costs that everyone has such as buying a computer, petrol, etc., are taken into account as they only look at the bottom line 'profit' figure. We have never missed a mortgage payment in thirty years so that in itself should show we never borrow beyond our means but unfortunately, that is not sufficient for the lenders. In the 'old days' when your branch bank manager was able to make decisions on his own, we never had a problem as he knew us and knew the business. Since their demise, we have had to go 'self cert' and pay over the odds (although our two year fixed with N.Rock which comes to an end on 1st May was only 4.49%)!! Those were the days!!!

Rick62

I don't expect things to 'settle down' or get better the next couple of months, things are getting worse daily, even though we have had a BOE rate cut since the deals available now are much worse than in January.

Capital is drying up by the day, any lenders with half decent rates are doing 2 or 3 times their target business and there is a fundamental shift back towards old fashioned lending, this is not a temporary or short term thing, IMO.

barnconverter

Thanks for your advice. We have made a decision now over a deal our F.A has come up with so thanks for everyone who helped.