Thrush

iTrader: (1)

Guess you are the guy to ask....

Just got my mortgage offer from Nationwide today - the actual offer, not the principal (that was done last month, surveys all done on property now, gone to final offer thingy, told it's in the bag, all that needs to be done is solicitors to exchange contracts and the house is mine)

Now, the papers says the mortgage offer is valid for six months - I take it that within that time the figures quoted, and the interest rates quoted, are fixed in contract?

Reason I ask is that I have a initial fixed rate period of 5.38%, after that it goes to variable base rate, currently 6.49% (i realise within two years this will more than likely be different)

Question is, if the Bank of England increase the base rate again like predicted, will my interest rate change? Surely it shouldn't do cos the mortgage has been offered at 5.83 fixed, but is there anyway Nationwide can change it? Is there a timescale clause, like the solicitors take upto a month to sort it all out, and in that time the B.O.E up the base rate, so Nationwide up my fixed rate before I make my first payment?

I'm a little bit shit-scared that in the next 2 years the interest will rocket, and when I come out of my fixed period, I won't be able to afford repayments

bud-weis

House buying is a mine field i have found out
it's scary isn't it mate,especially when your offered more than you can really afford in some cases,and so many fees for this that and the other....i'm cacking it really

COMEDY DAN

The risk is always there unfortuantely that when you come out of your fixed term, the interest goes up dramatically, which has been a problem for people in the past, like you have said and have then struggled to make repayments from then on however, one you are out of your fixed term you will be able to seek advice from other lenders who will all try and be competitive and keep the rate down.

All figures that have been quoted are ALL safe within the 6 month period, even if the rates have changed in 4 months or 5 etc, so you are safe in that aspect.

Hope this helps.



It sure is, so much to consider and risks and gambles with every move, however things seem so right, the first night you spend in your own home that belongs to you.

bud-weis

also,everybody is trying to make too much money on things!! we went to see a mortgage adviser who searched for a few suitable mortgages and on one that we had asked for he gave us a qoute,the lender was Abbey and it was for a 100% mortgage,
the following day we went to see Abbey themselves and they quoted the same amount,but it would be £40 per month more,PLUS it was only 97%,so we'd need to hack into our savings to cover the deposit.....How the fook does that work out,surely they sould be cheaper if we go direct to them???!!

sorry to hijack a little

Thrush

iTrader: (1)

Cheers Dan Still wish I had gone for a 5yr fixed term tho!

Martin - I was only allowed a 95% mortgage, so had to kick in £4k myself, plus all the fee's and shit - so the buy itself, before any repayments is gonna cost me near £10k

COMEDY DAN

Some private brokers have very good credibility (equating to discount on the interest rate) with Prime Sources, ie. The Bank lenders. This is determined by the amount of finance they draw up on a yearly basis.

They are then able to offload part of their discount to you which is a good thing.

For example:

Huddersfield mortgage services placed 8 million pounds worth of trade through Lloyds last year so they are allowed a rate of 4.1% from the bank.

They will then set you up with an interest rate of 4.6%

HOWEVER if you go to LLoyds tomorrow you will be charged 4.99% fixed for 2 years followed by a rate of 7.25% for the remainder of the term.



Stick with your broker as more often than not you will get a better deal than in the bank direct.

bud-weis

Thrush



it's a hell of a lot of money to have up front!!! luckily the mortgage adviser we have found is very good,and has found us quotes based on 100%,and also a quote which including paying off all outstanding credit/finance etc although we don't want to do that......we'd like some money to furnish once were in (our savings) which is why were opting for 100%

who is yours with mate?

COMEDY DAN

sounds good.

bud-weis

i think i will,thanks

Also,what exactly is the role of a solicitor in all of this? does he just move the money about or.......????

we've been told they can be quite expensive,so i guess i should find out what they actually do

bud-weis

it is good,BUT with everything outstanding adding on,the amount seemed too big and the repayments made us twitch a bit,so we decided against that route, it's a good offer,but maybe a fast track to bankruptcy

COMEDY DAN

The solicitors job is making sure the contracts from all partys are correct and legal, and your solicitor will be making sure that you are not being conned and are signing your life away to something that is ethical and legal.

The solicitor also takes care of the site surveys, and is also incharge of moving the money and paying the relevant parties.

Your solicitor will also be the person that holds the keys until completion.

Needed no matter what mate.



Off to bed now anyway peeps.....................

Thrush

iTrader: (1)

Martin - there are so many fee's that aren't completely obvious from the start tho...

The bank want a £4k deposit off me for a start
Then there's the arrangement fee (£500) and the survey/valuation (£325) for the bank
Then there's the first months interest charged BEFORE the first months repayment (£in my case £334)
Then the solicitors fee's - about £1500 (and stamp duty, on £160k it's £1600)

So all that is about £8.5k-ish - then there's money needed for furniture and stuff to put in the house, that I won't be able to buy per month for a while, so have to buy up front (plus, I need shit to sit on )

Don't forget apart from the solicitors fees, mortgage repayments, gas water and leccy, you also have to factor for council tax, phone line, internet, TV lisence, Sky (if you have it) etc, and don't forget buildings and contents insurance, life insurance, critical illness insurance, income protection insurance - most banks won't lend without buildings insurance and at least life insurance...

It all adds up!

I am factoring on having to fork out about £850-£900 per month in bills alone, and thats BEFORE food, house essentials (washing powder, bog brush etc) or going out to the pub etc....

bud-weis

jeez

we may be able to get a few discounts on the price of the property and the stamp duty as it's a new build (a few months from completion) so i may have to haggle/bribe the nice lady who works for David Wilson Homes.

Also my aunt is an estate agent so i'll sit down with her and steal advice and contacts

clutching at straws really,but a penny saved.......i don't like the feeling of having no money at all,it makes me VERY moody

Thrush

iTrader: (1)

Tell me about it - it's scaring the shit out of me!

If it wasn't for the fact that I will still have about £10k in the bank, then I simply wouldn't be doing this. Cos if it gets hard then at least I have money behind me in case it all goes a bit Pete Tong.....

saff_cossie

It sounds similar to here. Banks don't want to deal with people on mortgages, they would rather a broker take care of it. I have a couple of friends in the broking business who run their own firms and make a fortune AND get better rates for me than the bank can provide, even to a preferential customer.

Brokers are the way forward but to satisfy your curiosity, it is always advisable to see what a bank would offer directly.

Thrush - finish your fixed term, then jump to another fixed term. Sure it could be higher but at least it is fixed again or renegotiate the current one at the end of the term.

topaz

iTrader: (1)

why not set aside a little extra every month in that 2 years into a savings account, that way if the shit hit the fan you had a backup plan

dojj

iTrader: (3)

i've got a 2 year fixed at 4.29%, then it goes back up to 6.5% which is another £400 a month i can't really afford to pay

so i'll be looking at jumping onto the next cheap mortgage lender i can find and get it fixed for another few years

but with the news that inflation has hit a 3% high in last nights news, that means these deals may not be available for much longer

cossie4i+

iTrader: (15)

I keep thinking about taking a 10 year fixed term to pay of my Mortgage.

Found a good one at 4.95% with a arangement fee of £595

On 75k its £792 a month.

Steve.

COMEDY DAN

The other thing to mention, going back to the original question on, "how can a broker be cheaper than going direct to a bank".

Brokers have access to as many as 20 mainstream (prime) lenders and up to 60 non-prime lenders so they can offer you the best deal on the market to secure a deal with you and get your business.

If you go to the bank, the bank can only offer you their mortgage which might not be the best deal at the time.

dojj

iTrader: (3)

i'm sure there are better ones out there than that

on that basis, my mortgage payments would be nearly £1800 a month

but if you are doing it over 10 years and not 25 thats a good deal