Follow this topic
Q&A » Mortgages
I also get some child tax credits and child allowance.
We have a 15% deposit for the £92500 share. We have looked at the Santander and the Nationwide 3 year fix deals both at 5.69%. Our mortgage advisor however suggests the Woolwich 6.19% 3 year fix. What should we go for?
Report
212Have you queried the service charges ... I came across one article where they had doubled within a year or so of buying the property. Don't forget you also pay rent on the other 50%.
If they are identical in costs and penalties and rate beyond the 3 years then go for the cheapest interest rate ... otherwise factor in the differences to your future plans and go with which suits the best.
Posted on 02 June 2010 |
Love 1 love
Report
11Interest rates are bound to rise over the next three years, but with standard variable rates currently at 3.5% they are going to have to do a few jumps to match 6.19%! Taking this, and the administration and product charges that are being levied on the fixed rate mortgage, you need to do some sums to make sure a fixed rate is worth it - it might not be on the amount you are borrowing.
The other danger with fixed rates is that in a rising market you might come to the end of the term and find that the jump in repayments is crippling - alternatively in a falling market you might end up 'over' paying.
On the whole fixed rates are ideal if you know that there is going to be a change in your income after the fixed rate is up, eg a stepped promotion, exams resulting in salary increases etc. Other than that, you might want to consider a tracker or SVR to help with your long term budgeting.
Posted on 02 June 2010 | Love 1 love
Report
5Always worth asking the guys here on the mortgage team. They're very friendly guys and give free impartial advice.
You can ring them: 0800 804 8045 or look here: http://www.lovemoney.com/mortgages/
Posted on 03 June 2010 | Love 0 loves
Report
0Thanks for all your responses.
I will give the lovemoney mortgage team a call when i finish work(technically Im meant to be working now!).
The increase in service charges question - I think I read a similar article and so I asked the Housing Assocaition. They said that the rent would only increase by inflation, so I shouldn't ever expect any significant increases.
I am thinking about going for the woolwich mortgae, although it has a higher initial interest rate, the SVR after 3 years is +1.99% whilst the others are much higher +3.74 or +3.99%. Since i've only got a small choice of mortgages to go for I might end up stuck on the SVR after the initial 3 year period. Do you think this would be the best plan of action?
I've looked at trackers - and most are quite high for someone in my position -around + 4.49%. A 1.5% rise and i would be better off on a fixed rate. I think i'll go for a fixed rate for my first step into the mortgage market. But if anyone knows a good tracker or SVR mortgage for someone in my position then please let me know.
Thanks
Mat
Posted on 03 June 2010 | Love 0 loves
Report
212Service charges would apply to flats or houses within a shared space development ... they are a seperate charge to rent usually ... you pay that as the owner of the property under the terms of the Transfer ... not as a renter.
But as it's a housing association it's beyond my experience ... there may not be service charges involved ... but make sure.
The mortgage decision seems reasonable as long as you're comparing across all the products you can reach.
Posted on 04 June 2010 | Love 0 loves
Report
0Hey
Yeah, the service charges and rent are included as one payment from the Housing Association. The service charges include building insurance, a general upkeep of the area fund, an admin charge and the maintenance of a drainage pump.
I asked them loads of questions about the rent/service charges to make sure there were no surprises.
Yeah I think the mortgage should be ok. We can afford the repayments and the rent/service charges.
Has anyone had any good/bad experiences with the Woolwich?
Thanks
Posted on 04 June 2010 | Love 0 loves
Report
212I have a woolwich tracker mortgage ... it's going well ... no troubles ... they're responsive on the phone ... was sorted quickly ... very pleased ... but then I'm probably a perfect customer ... don't know how they behave when things don't go to plan.
Posted on 05 June 2010 | Love 0 loves
Report
Sign in or register to post an answer.
Register with lovemoney.com to start asking and answering questions on Q&A.
Get started nowRegistered already? Great! You can just sign in to ask and answer questions.
Sign in
Retweet
Comments (
Facebook