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Northern rock redemption


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Hi I have my mortage with Northern Rock which is fixed untill june 2008.Well they sent me a letter informing me that my current deal will come to an end 1st of june 2008,however it goes onto add and quote"We are unable to offer you a competitve deal at this time.therefore we suggest you contact an Independent Financial Advisor who will be able to help you find the best deal etc "So all they can offer is their Standard Variable Rate which I think is about 7.89% an extra £120 per month on my mortage payments.it also adds "In the meantime,if you would like any help to find a new mortage lender or would like to obtain a redemption statement contact us on etc etc"I rang for the statement which adds a early redemption figure of £2,400 based on redemption 30th april.However my arguement is I shouldn`t have to pay any redemption fees at all as it is Northern Rock,who are in effect,are ending the agreement.Any ideas where I would stand many thanks

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I think that you will find that the early redemption amount only applies if you repay prior to the full term, June this year.

 

It is probably a good idea to start using an IFA to commence looking for the best mortgage deal available on the market. Although there is still some time until your existing mtg expires, the formalities can drag on, so the sooner you start the better. My IFA and all the questions he received from the new lender took some 5 months to get sorted!!

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I think that you will find that the early redemption amount only applies if you repay prior to the full term, June this year.

 

It is probably a good idea to start using an IFA to commence looking for the best mortgage deal available on the market. Although there is still some time until your existing mtg expires, the formalities can drag on, so the sooner you start the better. My IFA and all the questions he received from the new lender took some 5 months to get sorted!!

 

Scaper is right about the redemption penalty. Start looking for a new deal around the end of April as rates change daily with the lenders adding or withdrawing products. With a good mortgage adviser, it should take no longer than 6 weeks to complete a remortgage. 4 weeks is the norm providing all documentation is in place.

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Nice of them isn't it! We, tax payers, bail the bank out to the sum not disimilar to the national debt of a small country and they fob you off with a thanks but no thanks!!

 

You will be pleased to hear, that redemption figure only applies until your current deal runs out - so on the 2nd of June you can transfer your mortgage to someone else without being charged the early repayment charge.

 

Word of caution - there may be other hidden 'admin' charges both Northern Rocks and your new lender. Whilst they may seem small in terms of your mortgage, think of your equity and try to minimise to cost of moving your mortgage as much as possible. It may be worth paying a slightly higher interest rate if you avoid paying Higher Lending Charges (remember, wherever possible the banks will think of a reason to charge you! We pay interest based on what we owe so what is the point of a higher lending charge? these are becoming higher and more common now the 'credit crunch' is settling in... banks eh? don'tch just love'em.

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All costs are totally transparent and will be featured within the Key Facts Illustration of the mortgage chosen before you decide it's for you. Higher Lending Charges are still there (mostly over 75-80% loan to value) but by seeking advice, these can be avoided from a whole of market mortgage adviser.

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many thanks have contacted Northern Rock for a more accurate redemption figure which by 1st by 1st of june should only be a discharge of mortage £250 and legal costs.However since our taxes are propping up Northern Rock I am not happy about paying any redemptions fees at all,regardless of what is in the small print.Any ideas? thanks

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  • 3 weeks later...
Guest shaff

Hi There..

 

I am exactly in the same poistion, but they have added the following charges if i go before the 1st June;

 

£250 Withdrawal Fee

£550 Early repayment charge

£1000 'help with cost' charge

 

Racking my brains to think how thwy can justify these charges

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Hi There..

 

I am exactly in the same poistion, but they have added the following charges if i go before the 1st June;

 

£250 Withdrawal Fee

£550 Early repayment charge

£1000 'help with cost' charge

 

Racking my brains to think how thwy can justify these charges

 

Check out your offer of loan. All these charges will be on it if applicable.

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well I am about to ring them for a settlement figure.I will also argue that any exits fees are unjust and remind them that our taxes have saved their business.I will let you know how I get on

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Shaff I have a email for Northern rock.I have put my complaint in writting and have informed the FSA that I planning to complain about the exit fees.If you email [email protected] and they will reply in by post in 5 working days you then have to contact FSA to make a formal complaint.My main arguement against these charges is that the rock`s problems arose from poor management and I am not prepared to pay any exit fees due to their imcompetence

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