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the shizzle => shootin' the shit => Topic started by: LucyB on July 25, 2012, 11:14:29 am
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Our fixed rate comes to an end in October, so I'm searching for a new deal.
The current provider (natwest) seem to be offering a reasonable tracker deal. This is obviously the path of least resistance as well, so quite attractive!
I've had a quick look on gocompare and moneysupermarket but it all seems pretty confusing and perhaps less biased than when I used them in the past (moneysupermarket were basically going to get a third party to call me, which I wasn't happy about).
My questions are:
Where to find the best advice?
How do I get an up-to-date valuation? This will make a big difference to the LTV as we have had a lot of work done since we moved in, and the market seems to have improved a little round here (been keeping an eye on the local prices, and they have been edging up). I did a free one through moneysupermarket, but I thought their valuation was way too high. How would I prove to the mortgage company what the current value is?
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We used a broker, London and Contry if I remember correctly. Once they'd given us all of the options our chosen offer had a £95 setup fee which included a valuation.
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My questions are:
Where to find the best advice?
The best people to seek advice from are brokers. They do this every day and should know the market better than anyone. There is a charge, but generally it should be more than offset by the fact they are likely to find a better deal than you would be able to.
How do I get an up-to-date valuation? This will make a big difference to the LTV as we have had a lot of work done since we moved in, and the market seems to have improved a little round here (been keeping an eye on the local prices, and they have been edging up). I did a free one through moneysupermarket, but I thought their valuation was way too high. How would I prove to the mortgage company what the current value is?
The free valuations on those websites are useless. The new mortgage provider will commission their own valuation, which will be charged back to you. If you want one done for your own peace of mind you will need to speak to an RICS valuer. Be warned that nearly everybody believes their property is worth more than it actually is, so you may find that a valuation can fall short of your expectations.
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Did a LOT of research when buying my house - best website I found is....
http://www.which.co.uk/money/mortgages-and-property/reviews-ns/mortgages/mortgage-finder/ (http://www.which.co.uk/money/mortgages-and-property/reviews-ns/mortgages/mortgage-finder/)
Would def try to get a lifetime tracker though (but don't hunt me down if the base rate miraculously goes up!).
Good luck.
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Another vote for using London & Country, very helpful, not hard sell. Up front about fees etc.
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With whatever you end up going for its always worth hitting your existing lender up to see how keen they are to hold on to your business if you get my drift.
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i'd go for a broker too.
didnt like comparison sites as they only compare the selected few providers who agreed a commission.
we're currently with first direct on a lifetime [offset] tracker of 2.99 and 2.79
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I check the current state of play of mortgages with the Money Advice Centre which is an organisation which has its origins in the Financial Services Authority.
As I understand you can search all available UK mortgages according to your criteriahere (http://pluto.moneyadviceservice.org.uk/Mortgages/Compare)
If the best deal compares well with the one offered by the NatWest I'd go with that.
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Would def try to get a lifetime tracker though (but don't hunt me down if the base rate miraculously goes up!).
FWIW, I would recommend anyone to think about a long-term fixed rate at this point. Eventually all this ultra-cheap money available globally is going to result in inflation and much higher interest rates. Not necessarily this year or next but eventually for sure.
Unfortunately not many long term mortgages are available over 5 years and are typically uncompetitively priced.
I would love to fix for 10 years and have been monitoring what's available for several years. When I last looked in May the only 10 year deal offered was with the Woolwich at 4.99% with a set up of £1499 a valuation fee of £445. Not sure what the LTV criteria was.
Unlike other countries UK householders are at greater mercy to macro economic interest shocks than many other nations.
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I would advise an independent FA for their impartiality.we have an excellent one who has advised on many mortgages over past 10 years for us and friends.sheis so good she has even advised on several mortgages where she gets no fee as they were best for us.
Personally I have always gone for BOE trackers as you are not at mercy of SVR as many people a arecurrently.historically these have performed better especially as the fees culture of recent years has taken off.also world economy is likely to be in the shout for years so rates likely to be low for considerable time.text Shiv and we well send you allusions phone no if you want
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Sorry to hijack, but a quick question on the same subject.
Our fixed rate is ending next month and we revert to the lender's base variable rate which is guaranteed to never exceed BOE + 2%
We're planning on just leaving it like for now as most predictions I've looked at seem to say the base rate will stay low for at least a couple of years, possibly more. Is this unwise? Seems pointless signing up to a much higher fixed rate if the BOE rate is going to stay in the doldrums for years.
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Sorry to hijack, but a quick question on the same subject.
Our fixed rate is ending next month and we revert to the lender's base variable rate which is guaranteed to never exceed BOE + 2%
We're planning on just leaving it like for now as most predictions I've looked at seem to say the base rate will stay low for at least a couple of years, possibly more. Is this unwise? Seems pointless signing up to a much higher fixed rate if the BOE rate is going to stay in the doldrums for years.
That's a good rate. I would stick to it.
Whilst Toby is correct that the risks of a 70's style inflation/interest shock is high in say 2 years+ onwards (for various reasons) my view is that given that only a five year fix is possible (which could catch you out when up for renewal) then trackers currently make the most sense.
If rates go up that is because they are forced up by inflation which in any case is commensurately shrinking the capital you have left to pay in real terms. As long as you can afford the repayments what you lose out in the short term you gain in the long.
If for example you get a full-on Weimar Republic dose of inflation then the the £100,000 left on your mortgage will be the same as the cost of a mars bar (not precisely but you get my point).
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Timely thread, we're in a similar situation. Fixed rate ends next month and we go onto SVR - currently 4.27%. This is actually a big improvement for us but I guess there are better deals available...
Bubba, seem to remember someone (jasper?) in your situation, remarking that they'd hit the jackpot basically.
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Cheers sharkus, that's put my mind at rest...
Bubba, seem to remember someone (jasper?) in your situation, remarking that they'd hit the jackpot basically.
Yeah, I must admit it's nice to finally reach the end of the 6.x% 5yr fixed rate we signed up for just before the economy went tits up :slap:
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Sorry to hijack, but a quick question on the same subject.
Our fixed rate is ending next month and we revert to the lender's base variable rate which is guaranteed to never exceed BOE + 2%
We're planning on just leaving it like for now as most predictions I've looked at seem to say the base rate will stay low for at least a couple of years, possibly more. Is this unwise? Seems pointless signing up to a much higher fixed rate if the BOE rate is going to stay in the doldrums for years.
I've been doing exactly this for the last year or so and it's worked out really well, I did think about swapping to another deal but with the rates as low as they are being a couple of percent above them actually works out as the best deal.
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Bubba, seem to remember someone (jasper?) in your situation, remarking that they'd hit the jackpot basically.
Yeah, I must admit it's nice to finally reach the end of the 6.x% 5yr fixed rate we signed up for just before the economy went tits up :slap:
Yeah it was me. Fixed rate ended and mortgage (on our other house) went from 5% to 0.75% above base rate (so 1.25% at the moment). ;D
2% above base rate is still very good, I'd stick with that Bubba.
I've recently had to get a new deal and ended up staying with the same lender as when my mortgage bloke looked at the other options there was nothing about that made a huge difference. When you take into account the cost and possible hassle of switching (and watch out for fees as mentioned) unless you're saving a whole % point or more it's not really worth it (unless you have a massive mortgage of course).
Of course every situation is different. Lucy as you are now self employed it's worth bearing in mind that you may well have to prove your income to a new lender whereas Nat West will be less likely to ask such questions if you are sticking with them (and not wanting to borrow more etc).
I can give you the number of my mortgage advisor if you like, he's sorted out some pretty nighmarish, complicated situations for various clients of mine in the past. However, as mentioned, if the Nat West deal is ok I'd be inclined to stick with it and I'm pretty sure he'll advise the same.
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I've always looked on mortgages as a form of gambling. If you are risk averse / have to guarantee what you will paying a fixed rate is the best option albeit the most expensive. Trackers are more of a gamble. SVR's have proven very poor in recent years as lenders can increase (or decrease) rate irrespective of what is happening to official BOE rate or the economy in general. Most SVR's at at 5/6% at the mo even though BOE rate at 0.5%. Historically SVR's broadly tracked BOE but those days are gone. If the commercial and investment decisions are forced to split the difference could become worse if they want more profit.
The other thing to be aware of is fees especially for lower rates. Typically these products only benefit those borrowing lg sums. They also only tend to be worthwhile if taken over extended periods as otherwise the fee does not offset the rate reduction. The introduction of fees has also made it less worthwhile (generally) switching regularly for the above reasons.
Remember you can mix tracker + fixed with the same provider to offset some of the risk of rate rise.
It's a huge decision and commitment so get some advice from an independent financial adviser preferably by recommendation and ensure they are truly indpendant/ ie. they look at the whole market.
As for Bubbas dilemma the product he is switching to is probably impossible to beat in todays market, i supsect as well that you can switch with no penalties at any point. If your product was switching to an SVR + 2% you would probably be paying 7% which could be crippling. I was switched to one of these deals a No of years ago and then as rates dropped I benefited by what has been the best financial decision of my life. At the time it felt steep but the benefits over medium term were huge.
Remember that the current economic downturn/depression could go on for many years. However, as a counter to that the No of times "the experts" have said economy will do X and it does the opposite is plentiful. It's a case of balancing risks vs your financial position.
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Lucy as you are now self employed it's worth bearing in mind that you may well have to prove your income to a new lender whereas Nat West will be less likely to ask such questions if you are sticking with them (and not wanting to borrow more etc).
That's a good point. A lot of lender will rule themselves out on this point alone as they will want to see three years of accounts.
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Another reason why knowing a good mortgage expert is very useful as they should know which lenders are better for this sort of thing and which to avoid like the plague. We have had a few instances recently where the lender (ING and another I can't remember) wont even accept accounts or copy tax rerturns and demanded tax calculations from HMRC (which they don't actually issue any more).
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We are remortgaging at the moment, I decided to try and do it myself this time after a bad experience with a broker last time.
Some things I have found...
The deals our existing lender was offering were significantly worse than the deals it was offering new customers. Clearly its better for them if we stay on SVR.
Worth a try, but it made sense for us to look for a new deal with a new lender even when you factor in fees and hassle.
Its tricky to compare deals if you are at or near a LTV threshold and you are estimating the value of your own house. A small difference in the value of your house one way or the other could put you in a different LTV bracket and get you access/deny you access to different deals. You don't really know until they send someone out to value the house (which you pay for).
You then have to hope they dont value the house at a level that takes you above 75% LTV for example, cos I imagine they will then offer you a worse rate and you have wasted shit loads of time.
I left it too late. It is taking something like 6 weeks to switch to a new deal assuming everything goes well. You can end up on an expensive SVR for a couple of months which wipes out some of the benefit of moving.
You can access slightly better rates (or avoid up front fees) with some lenders by opening a fee paying bank account with them at the same time. My instinct was that sounds like a con but it is still worth doing the maths I guess.
Applying online is a waste of time. They phone you up and make you go through all the questions again anyway.
The comparsion tables on moneyfacts.co.uk and money advice service website are good.
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Just to contradict myself looks like I'll be going with the new 5 year fixed rate with Nationwide at 3.39% which is competitive and also the same as their 3 year tracker rate.
As we were committed to the Nationwide anyway and base rates can only decrease by 0.5% the potential opportunity cost is negligible whereas upside pressure on inflation/interest rates 2 years out could be considerable.
Sorted. Now if the vendors would only take their heads out of their backsides...
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Its tricky to compare deals if you are at or near a LTV threshold
Interesting, any idea where the thresholds sit? We'd be looking for 60-65%, assuming the most recent valuation holds...
new 5 year fixed rate with Nationwide at 3.59%
Sounds pretty good, if we can get anything like that it will make a big difference to our outgoings.
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new 5 year fixed rate with Nationwide at 3.59%
Sounds pretty good, if we can get anything like that it will make a big difference to our outgoings.
Amended that as it is lower still at 3.39%.
They have another interesting product I noticed called a Flexible Mortgage (http://www.nationwide.co.uk/mortgages/interestrates-types/specialoffers.htm?offer=6). Which allows you to make underpayments and overpayments which is useful if your income varies. The fees are low too. The only catch is that you have to have one of their current accounts running for 3 months before qualifying. It is up to 85% LTV.
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Its tricky to compare deals if you are at or near a LTV threshold
Interesting, any idea where the thresholds sit? We'd be looking for 60-65%, assuming the most recent valuation holds...
new 5 year fixed rate with Nationwide at 3.59%
Sounds pretty good, if we can get anything like that it will make a big difference to our outgoings.
I renewed with First Direct last year (going down from 6.7% to 2.79% in the process!) which was a pain free experience and their rates seemed very good if you have a LTV of 65%. You can get a 2.79% life tracker or short term fixed rate deals (2 years I think) of 2.64%.
If you want 5 years fixed I think their rate is about 3.79%, so it looks like Nationwide beats that.
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Not wanting to be too tedious about this but: it's not only the risk of much higher inflation that borrowers should worry about - just a normalisation of monetary policy relative to the current inflation rate would require much higher interest rates. If you look at rates since the BoE was given independence in 1997, they have always been around CPI or a bit higher. The current near-zero rate is very anomalous and is only there because of the stale perception that we are still in a financial crisis.
Absolutely but for a borrower making the most of that knowledge when the timing of the normalisation is unknown in a market where a 5 year fixed rate is the best you can do gives little scope for effective hedging. Lets say you sign up now for 5 years and the normalisation takes place in 4.5 years then you are faced with re-entering the mortgage market when rates and offers will be very poor.
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I'm in the process of applying for a mortgage for purchasing a new house. My FA reckons 5 year fixed are good value at the moment when you consider a) they're only .5% above the Trackers and b) if you look at the long term cost of lending.
We are also in the position where we want to know where we are at as my other half will be stopping working next yr for a few years.
Likely we'll apply for a Woolwich mortgage. Also in the interesting position whereby we're buying a house that needs major work (seemed to make sense, what with our second child due in January ;)) so expect to run into difficulties with lender valuations/whether they'll even lend at all... as the roof is f*ct etc etc
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Its tricky to compare deals if you are at or near a LTV threshold
Interesting, any idea where the thresholds sit? We'd be looking for 60-65%, assuming the most recent valuation holds...
No idea to be honest. I dont know if there is any consistency across lenders on this but I would have thought you can access most of the best deals with 60-65%.
I found there was either a slightly higher rate or higher fee between say 70 and 75% LTV and if you are just guessing on the value of your house its hard to compare deals.
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Just been told by the wife that the boe base rate may Be cut to 0.25% next month.
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Just been told by the wife that the boe base rate may Be cut to 0.25% next month.
Is she Christine Lagarde ? :wub:
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Just to revisit this, finally getting round to it...
Anyone know any good deals? Looking at 65% LTV over 25 years.
Or care to speculate on what the base rate is likely to do in the next year or two?
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I hedged my bets and fixed at 3.39% for five years with Nationwide.
Currently Nationwide and HSBC are offering 4 and 5 year fixes at 2.69% and 2.89% respectively but 60% LTV which sounds exceptionally good but obv. look into their fee and other setup costs.
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Ta. Spotted that First Direct are offering 2.14% above base for term, which looks impressive, but then I'm not overly familiar with what the best tracker rates are...
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Any advance on 1.88% above base for term?
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Our current 2 year fixed rate will come to an end in April so need to choose another product or face the unappetising 3.94% SVR.
The bank reckons our house price has increased by £10k since we bought it 2 years ago (YYFY) so we now fit into the next LTV bracket down (OK, I'm boasting now :dance1:)
The tracker rates on offer are lifetime rates (24 years left on the mortgage), so we're thinking to steer well clear of them.
The choice is really between a 5 year fixed rate of 2.89% or a 2 year fixed rate of 1.89%.
Do we hedge the bets and take the 5 year product or gamble and go with the 2 year? Either way this will be a £50 or £100 a month saving to the household so significantly good news :beer2:
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Depends on the setup fee and how that factors in.
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Each of those involves a £300 fee (though I don't know whether that is payable as a lump sum or whether it is added to the debt - in which case it would probably be shit). I've done the sums (or rather, Martin Lewis has: http://www.moneysavingexpert.com/mortgages/compare-mortgage-rates (http://www.moneysavingexpert.com/mortgages/compare-mortgage-rates) ) and the products with fees always work out better than their free equivalents, as you'd hope!
The more expensive rates (£999) don't appear to be very effective over the life of the product.
The question is really whether we should fix for 2 or 5 years.
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Whichever deal you take continue to pay the same amount you are paying now.
Fuck the extra £50 a month, you can already afford the mortgage you're paying so pay the same as 24 years will become a lot less.
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How about 10 years at 2.94% ?
I tried to persuade Nationwide to move us to this before our 5 year deal was up but they refused to waive the skyhigh early repayment charges.
http://www.nationwide.co.uk/about/media-centre-and-specialist-areas/media-centre/press-releases/archive/2015/1/20-jan-lowest-10-year-fixed-rate-mortage (http://www.nationwide.co.uk/about/media-centre-and-specialist-areas/media-centre/press-releases/archive/2015/1/20-jan-lowest-10-year-fixed-rate-mortage)
I also differ to Jasper with regard to repayment amounts - I would have everything on interest only if I could
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How come shark?
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Just to confirm, Habrich. Do you mean to say that the most sensible option is to take a low rate and put the excess money into some financial product or other?
Without getting into more complicated products, cash ISAs are paying out between 1.5 and 2.5% at the moment, so with borrowing rates being consistently higher it makes more sense to me to put excess money into overpayments (with some still going to the cash ISA rainy day fund; haven't got round to a stocks and shares ISA yet) insofar as early repayment rules allow.
Stabbsy sent me a PM with some useful stuff to consider so need to scratch our heads a little more yet.
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Ah right. I've no interest in buying a bigger house, just happy I'll have no mortgage relatively soon.
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Just to confirm, Habrich. Do you mean to say that the most sensible option is to take a low rate and put the excess money into some financial product or other?
Without getting into more complicated products, cash ISAs are paying out between 1.5 and 2.5% at the moment, so with borrowing rates being consistently higher it makes more sense to me to put excess money into overpayments (with some still going to the cash ISA rainy day fund; haven't got round to a stocks and shares ISA yet) insofar as early repayment rules allow.
Stabbsy sent me a PM with some useful stuff to consider so need to scratch our heads a little more yet.
Yes - stocks over the longer term as habrich suggests is worth considering. One relatively straightforward and flexible approach would be to regularly pay into a shares ISA that can hold a low cost FTSE tracker fund that reinvests the dividends like this one (https://www.fidelity.co.uk/investor/research-funds/fund-supermarket/factsheet/summary.page?idtype=ISIN&fundid=GB00BJS8SF95&UseProxy=Yes&fundname=Fidelity%20Index%20UK%20Fund%20P-Acc&UserChannel=Direct).
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Some good advice on here. Having been through this recently there are a few other things i would consider before overpaying (i am not an IFA):
1. Will be able to keep a contingency fund (something like 3-6 months take home) somewhere you can get it fast?
2. Check when your mortgage company calculates interest: if it is not daily, keep the cash somewhere earning a bit of interest (maybe one of the new-breed current accounts paying 4-5%) until just before mortgage the interest calc date.
3. Make sure you will not not be moved onto reduced normal payments or locked in to making payments at the higher rate every time.
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1. Will be able to keep a contingency fund (something like 3-6 months take home) somewhere you can get it fast?
The stocks ISA can be cashed in immediately if required in an emergency and I regarded it as the rainy day fund when I had one (before diverting it into property). If you've (over)paid that money instead to your mortgage lender it is out of reach.
As habrich implies a lot comes down to knowing yourself and your attitude and restraint (or otherwise) to finances. If the temptation of having a large instant access pot of money is too tempting when faced with a desirable non-emergency consumable purchase then its not the right choice. Similarly if the volatility of the value of that fund has you checking the FTSE everyday and sweating every night than it is also not for you.
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I think good advise for the normal punter (ie don't drive around in 5 series or have multiple properties etc...) on here would be to make over payments instead of banking it (interest on borrowing is always more than interest on saving accounts), gambling on the stock market is just that, gambling.
Interesting thoughts on a contingancy fund, definately worth considering but you'll still be loosing money on it.
We have an old woolwich mortage from long ago and we're paying something daft like 0.25% over base and its as flexable as you want it to be and we have a reserve account on it. Won't be changing it anytime soon
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If you're looking to remortgage we''l do 'mates rates' for the conveyancing.
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We have an old woolwich mortage from long ago and we're paying something daft like 0.25% over base and its as flexable as you want it to be and we have a reserve account on it. Won't be changing it anytime soon
http://youtu.be/mID5B2MNmoY (http://youtu.be/mID5B2MNmoY)
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If you're looking to remortgage we''l do 'mates rates' for the conveyancing.
'cause my ignorance, but why do we need conveyancing for a remortgage? Get it when you are 'buying' the house from someone, but can't quite understand why I need solicitors for a remortgage?
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Whilst I agree broadly that
interest on borrowing is always more than interest on saving accounts
I'd say that these are abnormal times and this isn't necessarily true just now.
Will is talking about a 5 year fixed rate of 2.89% or a 2 year fixed rate of 1.89%.
But you can get 5% gross from a few thousand (or ~3% gross on more)
in a current account (http://www.moneysavingexpert.com/savings/savings-accounts-best-interest) and up to 6% gross by
putting a bit away regular like (http://www.moneysavingexpert.com/savings/best-regular-savings-accounts) (actual interest is likely to be lower than headline because of limit to amount paid in)
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If you're looking to remortgage we''l do 'mates rates' for the conveyancing.
'cause my ignorance, but why do we need conveyancing for a remortgage? Get it when you are 'buying' the house from someone, but can't quite understand why I need solicitors for a remortgage?
Because unless you're staying with the same mortgage provider you'll need to discharge one mortgage and have the entry on the LR changed, I can't imagine there's a lender who'll allow you to do this yourself and even if you're staying with the same lender they may insist on sols doing the work.
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I think good advise for the normal punter (ie don't drive around in 5 series or have multiple properties etc...) on here would be to make over payments instead of banking it (interest on borrowing is always more than interest on saving accounts), gambling on the stock market is just that, gambling.
I think there's some sense there. Also worth considering that many people these days have considerable exposure to the stock market in the form of their pensions.
Though as somebody who's fairly risk adverse this possibly displays my biases.
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Though as somebody who's fairly risk adverse this possibly displays my biases.
Climbers at some point risked life or at least limb. It is not logical (to me) to shy away from from calculated risks hich don't hurt or kill you.
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I've now got a vision of Shark stick-clipping his way through the stock market...
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Though as somebody who's fairly risk adverse this possibly displays my biases.
Climbers at some point risked life or at least limb. It is not logical (to me) to shy away from from calculated risks hich don't hurt or kill you.
That only make sense if you think there has to be a direct connection between how you view physical risk in activities you do in your free time and how you view financial (and other) risk in you general life and work. For me there is no connection at all - I enjoy a degree of risk and excitement in both climbing and cycling but work and finance wise I'm the epitome of boring middle class.
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just renewed mine today to a 2 year fixed and saved 60 a month.shall carry on paying the amount into though as get it payed off sooner.
doing that rather than the massive pension payments at work
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Are the fire service pensions not pretty good?
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This thread has spurred me into sorting my morgage/remorgage out. Tesco seem to have a good deal on fixed rate... only £195 switc over fee on 2/5yrs with intial rates being pretty standard to £1000 switch overs and svr of 4.24 thereafter.. :)
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If you're looking to remortgage we''l do 'mates rates' for the conveyancing.
'cause my ignorance, but why do we need conveyancing for a remortgage? Get it when you are 'buying' the house from someone, but can't quite understand why I need solicitors for a remortgage?
Because unless you're staying with the same mortgage provider you'll need to discharge one mortgage and have the entry on the LR changed, I can't imagine there's a lender who'll allow you to do this yourself and even if you're staying with the same lender they may insist on sols doing the work.
Thx for the explanation.
Whats the going rate?
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That only make sense if you think there has to be a direct connection between how you view physical risk in activities you do in your free time and how you view financial (and other) risk in you general life and work.
Its all life.
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just renewed mine today to a 2 year fixed and saved 60 a month.shall carry on paying the amount into though as get it payed off sooner.
doing that rather than the massive pension payments at work
I'm not a financial advisor but a quick Google finds that the 2006 NFPS has employee contribution rate of approx 9-10% and a nominal employer contribution rate of 14.2% - I think even Shark would consider that to be very difficult investment to turn down unless you have very specific personal circumstances.
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If you're looking to remortgage we''l do 'mates rates' for the conveyancing.
'cause my ignorance, but why do we need conveyancing for a remortgage? Get it when you are 'buying' the house from someone, but can't quite understand why I need solicitors for a remortgage?
Because unless you're staying with the same mortgage provider you'll need to discharge one mortgage and have the entry on the LR changed, I can't imagine there's a lender who'll allow you to do this yourself and even if you're staying with the same lender they may insist on sols doing the work.
Thx for the explanation.
Whats the going rate?
We'd do a UKB special @ £270 + VAT & dibs but we're not on the Santander Panel.
There are some bucket shops who'll charge £150 to £225 but at this price you're getting an an unqualified monkey and your 'client experience' will be shit with no one returning your calls etc.
People think that remortgages are a five minute job, they're not.
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just renewed mine today to a 2 year fixed and saved 60 a month.shall carry on paying the amount into though as get it payed off sooner.
doing that rather than the massive pension payments at work
I'm not a financial advisor but a quick Google finds that the 2006 NFPS has employee contribution rate of approx 9-10% and a nominal employer contribution rate of 14.2% - I think even Shark would consider that to be very difficult investment to turn down unless you have very specific personal circumstances.
There have been a few company pension schemes that have gone to the wall as Im sure you are aware so by no means risk free. There are also charges (sometimes well hidden) and most funds perform less well than the FTSE100. With ISAs you (effectively) are taxed on the way in but pensions you are taxed on the way out subject to allowances. They are also subject to political meddling though Osbourn has gone some way to increasing flexibility. There are advantages to pension schemes and employer contribution is an additional incentive to take into consideration but not necessarily the no brainer you imply.
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There have been a few company pension schemes that have gone to the wall as Im sure you are aware so by no means risk free. There are also charges (sometimes well hidden) and most funds perform less well than the FTSE100. With ISAs you (effectively) are taxed on the way in but pensions you are taxed on the way out subject to allowances. They are also subject to political meddling though Osbourn has gone some way to increasing flexibility. There are advantages to pension schemes and employer contribution is an additional incentive to take into consideration but not necessarily the no brainer you imply.
Well its a government scheme so is pretty much as low risk as you can get.
I'd be interested to see some maths that suggests you can get a better return investing 10% of your income outside of a pension compared to investing 24% of you income inside one.
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I spoke to a fit bank drone at TSB about the 5% on the first 2k thing a couple of weeks ago
she pointed out that my wife and I can have 3 such accounts - one each and one joint and also said that just shifting my wage through all three (one into the other into the other) each month would be cool with them for the basic conditions
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There have been a few company pension schemes that have gone to the wall as Im sure you are aware so by no means risk free. There are also charges (sometimes well hidden) and most funds perform less well than the FTSE100. With ISAs you (effectively) are taxed on the way in but pensions you are taxed on the way out subject to allowances. They are also subject to political meddling though Osbourn has gone some way to increasing flexibility. There are advantages to pension schemes and employer contribution is an additional incentive to take into consideration but not necessarily the no brainer you imply.
Well its a government scheme so is pretty much as low risk as you can get.
I'd be interested to see some maths that suggests you can get a better return investing 10% of your income outside of a pension compared to investing 24% of you income inside one.
I was making some general points about Pensions vs ISAs. Granted in the near future you are not forced into an annuity but your "investment" went to zero when you died.
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When you bank your hard-earned pay check, the bank immediately loans it out to Shark to buy yet another Sheffield student flat.
Thanks guys :beer2:
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Just to confirm, Habrich. Do you mean to say that the most sensible option is to take a low rate and put the excess money into some financial product or other?
Without getting into more complicated products, cash ISAs are paying out between 1.5 and 2.5% at the moment, so with borrowing rates being consistently higher it makes more sense to me to put excess money into overpayments (with some still going to the cash ISA rainy day fund; haven't got round to a stocks and shares ISA yet) insofar as early repayment rules allow.
Stabbsy sent me a PM with some useful stuff to consider so need to scratch our heads a little more yet.
Yes - stocks over the longer term as habrich suggests is worth considering. One relatively straightforward and flexible approach would be to regularly pay into a shares ISA that can hold a low cost FTSE tracker fund that reinvests the dividends like this one (https://www.fidelity.co.uk/investor/research-funds/fund-supermarket/factsheet/summary.page?idtype=ISIN&fundid=GB00BJS8SF95&UseProxy=Yes&fundname=Fidelity%20Index%20UK%20Fund%20P-Acc&UserChannel=Direct).
3.05% of that fund is BAT :spank:
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you got a problem with selling fags to kids or something?
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Nah, G's just a lifelong Imperial Tobacco man.
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just renewed mine today to a 2 year fixed and saved 60 a month.shall carry on paying the amount into though as get it payed off sooner.
doing that rather than the massive pension payments at work
It seems like since I first took out my mortgage the rulse have changed and now, over the phone, companies are unwilling (unable?) to give out terms and rates and instead spend 60 to 90 mins asking your opinon on financial risk and then present you with one solution (as deemed best by them). Has the general public been deemed incapable of deciding their own financial future in the past few years?
This is quite annyoing, mainly because First Direct can't offer me a phone appointment for nigh on 3 weeks!
Is there a way to proceed 'un-advised'?
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Yes, the government has finally woken up to the fact that most people are pretty ignorant when it comes to 'number style err economic thingies' and so on and it is now part of the regulation of financial services / banking that the affordability of the loan is discussed and the bank gives advice.
When you look at the number of people with interest only policies with policies that won't cover the principle, people not allowing for rate rises and so on I'd say this paternalistic approach is no bad thing.
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Affordability, key facts etc. fair enough... but I find the approach of only presenting me/the public with one rate that they deem best for me as a little patronising.
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Best not to go direct to the lender and get someone who knows how to sort these things out to sort it out. In my experience (and that of loads of my clients, friends, family etc) anyway.
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Affordability, key facts etc. fair enough... but I find the approach of only presenting me/the public with one rate that they deem best for me as a little patronising.
We were presentd with various options, in terms of periods of fix and so on all with different rates as well as flexible BOEBR + x%, of course they were all RBS products but that's because we got our mortgage through our bank. While we might have been able to save £30 per month by shopping around the upfront brokers fees and the risk of losing the house we want wasn't worth it.
Anyone with half a brain knows we're in line for another recession: if we get another 3/4 years of good growth (I can't see it lasting longer than that) the next time I don't think we'll be able to keep rates @ .5% and I expect that there'll be a significant contraction in property values and a lot more repos.
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We were presentd with various options, in terms of periods of fix and so on all with different rates as well as flexible BOEBR + x%...
...and I'm informed as of April last year they can no longer do this, hence the above.
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Best not to go direct to the lender and get someone who knows how to sort these things out to sort it out. In my experience (and that of loads of my clients, friends, family etc) anyway.
:agree:
Usually I am against using intermediaries but things have got so complicated now that using an adviser is good value for money.
PM me if you want a recommendation.
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My mate's an FA and he basically told me who to go old skool - face-to-face appointments in branch with big lenders, as I was pushing what was possible in terms of income multiples. That was September last year just as all the new stress tests were coming in. I went to Woolwich/Barclays and told them what product I wanted. A fair bit of jiggery pokery, but they were very good to deal with. It was like a trad meeting with a bank manager.
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Pretty much my experience, although we were well below the usual threshold re multipliers.
From memory I think most brokers will charge around 1% so you could easily be looking at a couple of k which works out at £50 per month over three years (apparently about the average length of a mortgage is 4 years) so you've got to be making some pretty serious savings to make the brokers fee worth while.
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From memory I think most brokers will charge around 1% so you could easily be looking at a couple of k which works out at £50 per month over three years (apparently about the average length of a mortgage is 4 years) so you've got to be making some pretty serious savings to make the brokers fee worth while.
If there's no upfront fee to the process there's no harm in asking.
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I think £200/250 upfront fee is what you should be looking at - they also get a kickback from the providers.
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Absolutely not, but a lot of the time the fees are wrapped up with the product and can be ratehr a lot!
I've seen £3k fees on mortgages of £100k or there abouts for council right to buy transactions, I can understand sub prime borrowers will pay higher fees but gven the costs of the broker is usually when they make the application (we were told there was a about a grand for the applciation fee and then a fruther arranement fee) I wonder how much free advice you're actualyl getting.
Shark, and who do you think bears the cost of the commission / referral ;)
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Shark, and who do you think bears the cost of the commission / referral ;)
The mortgage lender.
It is their way of having an outsourced sales/processing capability as opposed to a salaried salesforce and administrators .
The mortgage costs/rates would be the same if I went direct.
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Not in all cases, in some they're bundled up and thrown in.
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I've used the same guy for years and have recommended him to loads of people. I don't recall anyone ever saying he'd charged them a fee and he definitely doesn't add charges to the mortgage. He gets paid by the lender as shark says.
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I'm no saying it's across the board, but just that some agents / brokers do charge significant fees, indeed there's a group litigation order in force with regard the very practice I'm referring to.
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Not in all cases, in some they're bundled up and thrown in.
You got me worried enough to re-check the mortgage illustration
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It may just be a sub prime or alt A practice, not really sure, I just know that the cvntish estate agents and their tied semi trained fucktwards weren't anyone I would want to deal with.
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I've used the same guy for years and have recommended him to loads of people. I don't recall anyone ever saying he'd charged them a fee and he definitely doesn't add charges to the mortgage. He gets paid by the lender as shark says.
He charges £350 Jasper. But he got me a mortgage sorted (subject to valuation) in about 1 day. And then after realising that we wouldn't have the latest Works accounts ready for about another month he got me another one sorted in less than 1 more day.
Meanwhile it took 1 month, 2 appointments in branch and a phone call to get an appointment with Natwests actual mortgage guy. The phone call was just me repeating what I had already told the branch staff.
This all means that I can go skiing next week safe in the knowledge that I almost certainly have a house (subject to Greg not finding anything drastically wrong) to move into a couple of weeks after I get back. This is important to me, probably more important that any potential saving of going via the bank.
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Nat west in Manchester were the absolute opposite, but any way nice one,has it double cellars :alky:?
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Ah fair enough G. Must depend on the individual case/lender etc.
As you say, £350 to sort it like that is buttons. Good to hear it's worked out.
I could tell a few stories about people who have managed to get mortgages via the same guy who would have been (or actually had been) fucked going straight to the bank but obviously I can't.
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I've no doubt a good broker can work miracles, however you should see the professional negligence claims that can arise when the broker 'does his thang', I just batted one off as the stupid wankers missed limitation (I think we were alright in any event but the claimant's failure to serve within 4 months was a bonus).
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Nat west in Manchester were the absolute opposite, but any way nice one,has it double cellars :alky:?
FFS Tom, you nearly got puntered for even thinking that I might by a house without ample cellerage
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And I'd have deserved it too.
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What's the current thinking on mortgages?
I am due to renew and unsure whether to go for another two years fixed or to go longer at five to ten years? Obviously there is a cost involved with taking the longer option - my current mortgage provider Nationwide are quoting 1.74% for two years as opposed to 3.09% for ten years (60-70% LTV) but the difference between the two is circa £50 a month which is quite a few fuck alls.
Both of those are without fees so a slightly higher interest rate but I can not see that the lower interest payment you get with paying a fee actually saves money but please tell me different if this is not the case.
Should add that I have asked my mortgage adviser to look into this for me anyway so the interest rate is likely to drop but I will have to take into consideration the remortgaging cost to offset any savings at which point I suspect the longer deal will start to look a better bet.
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I'm attracted to ten year fixes but they have started to creep back up though your adviser should be able to do better than 3.09%. Once you have all the options available get a calculator out to compare costs then decide how personally important the security of a known amount is to you each month versus the unpredictably of future deals. Regarding predicting the future direction of interest rates over the next 10 years anyone who says they know is a fool.
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Hmm. Those graphs would suggest we are in for a long period south of the line. How long do you expect to live habrich?
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The line will change over time since its the "average" (presumably mean). If the long term US Treasury yield remains low for a protracted period the mean will start to decrease and the line will drop. In that sense its somewhat arbitrary just as the choice of highlighting the 3% lows (what their significance is I've no idea).
Quite why they highlighted periods where yield dropped below 3% with the grey blobs is anyones guess, as another horizontal line would provide a much clearer distinction.
The second graphs trend line could do with a confidence interval around it too.
I'm unsure how relevant data from around 100 years ago is to the current situation, global economics has changed drastically and not every country is the US so it would be useful to have similar data on other countries for comparison.
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Hmm. Those graphs would suggest we are in for a long period south of the line. How long do you expect to live habrich?
I am quietly confident that I will live long enough to say "I told you so" to Shark.
I'm not going to argue with you until you've written my reference
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FWIW, I would recommend anyone to think about a long-term fixed rate at this point. Eventually all this ultra-cheap money available globally is going to result in inflation and much higher interest rates. Not necessarily this year or next but eventually for sure.
predicting the future direction of interest rates over the next 10 years anyone who says they know is a fool.
I'm with Shark on this one ;)
In hindsight getting a fixed five years ago would have been a bad call, even if it was right according to all the long term fundamentals. As the big man sad:
In the long run we are all dead
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Ha ha. Quality searching, Murph.
I saw it before I saw what you wrote today - it was the first page in the thread ;)
Out of interest, what were typical fixed rates available five years ago, and what are they now?
No idea. But that advice from 2012 was in the context of getting a fixed rate mortgage which would likely have ended by now. I'm guessing they have gone up.
As everyone's favourite baseball coach once said:
[quote author = Yogi Berra]
It's tough to make predictions, especially about the future.
[/quote]
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As everyone's favourite baseball coach once said:
It's tough to make predictions, especially about the future.
Or as the statistician George Box is often quoted* as having said...
Essentially, all models are wrong, but some are useful. However, the approximate nature of the model must always be borne in mind.
* There is some uncertainty over whether Box actually said (or wrote) this see Dr Fisher's casebook: Play it again, Sam (http://onlinelibrary.wiley.com/doi/10.1111/j.1740-9713.2016.00884.x/full) for details (stick the DOI in something like Sci-Hub.io if really interested).
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... followed by
(http://www.economicshelp.org/wp-content/uploads/2014/09/eu-bond-yields.png)