how much do you pay back

THSHARIF

my solictor has told me that the mortage i am going to take out shows that for every 1 pound i borrow i will pay back £2.12.
this is a 25 year repayment mortgage borrowing 98k, i have a fix rate of 5.74 3 years withh 899 arrangement fee he said i will be paying back to much,
i think i have a decent deal , is thier any advice on this info,

i think my solictor doesnt know what he is going on about when he said for every 1 pound i borrow i should be paying back in the region of £1.60

JC_Derby

£1.60*£98000/25yrs/12 months =250.88 a month repayment
£2.12*£98000/25rs/12months = £692

My mortgage was 30k approx for a 20 year mortgage and my repayment was approx £240 a month.

Non quite sure where you get your idea of £1.60 per pound borrowed from, but i would suggest its incorrect and that £2.12 is much more realistic

THSHARIF

my solicitor has lost the plot , he baffled me when he said that i should be looking at £1.60-£1.70 for every£1.

the mothly payment is 612 per month with my offer

JC_Derby

Yeah i reckon thats about right.
Solicitors opinion seems strange. But im not an expert, just going on my experience

Tiddler_2

It really annoys me when solicitors start to stick their noses into areas that don't really concern them.

Have they completed a factfind? So how do they know what rate you qualify for?

They should just do the job that you are paying them for!!

I have just looked at a file for a customer who took out a mortgage for 27 years at a rate of 4.39% fixed for 2 years then 25 years at 6.5%. Their pay back was £2.06 per £1 borrowed.

Now that would be a little bit higher than the 25 year equivalent, but not massively. Now if your solicitor thinks that he can get you a new mortgage for less than 4.39% can you ask him where, because I have quite a few customers who would be interested in that deal!!

In the real world the pay back amount and also APRs mean nothing with regards to the real value of a mortgage, as they assume that interest rates will never change, and that you will keep that mortgage for the next 25 years. Most people will change their mortgage deal every 2/3/5 years or so, thus rendering the calculations a waste of time

Ian_Griffiths_Halifax

This section of the Key Facts Illustration has got to be the biggest cause of confusion and biggest waste of time. As Tiddler says, you aren't likely to have that deal with that lender for that term at that rate, let alone stay in that house.

Even though it is there so you can compare it against another deal, it's still a complete waste of time being there as the whole point of the KFI was for it to be clear for the client to compare one deal with another, and that just adds confusion.