options when out of fixed interest rate

T

tina2201

Registered User
Messages
12
Current situation:
Purchased property in October 2007 for €310k.
Mortgage was for €300k, with fixed interest rate of 5.05% for 3 years. Will end in October 2010, at which stage balance will be approx €290k. This is with Bank of Scotland.

With increased taxes & paycuts to my salary things were tight but was still okay with monthly payments. However 6 months ago i had a baby (not planned). My firm does not pay during maternity leave, so i have had to use my savings to pay mortgage since then. I will be returning to work now, and will have childcare costs also. I also have no idea of the interest rate that i will be facing at the end of the year, and this is what is really worrying me. BOS appear to have interest rates more than double anyone else in the market. I'm just wondering if i have any options, as if i have to take the interest rates they are offering at the moment (approx 6.5% & prob higher by oct) i will not be able to make the payments.

I assume i will not be able to move to another bank given the above figures? I assume i am in negative equity. House was on the market at 350k 6 months before i purchased for 310k, but prices have fallen since then again. Houses in the area were recently on the market for 310k, & one sold, but i obviously dont know how much it actually went for. How would i get a current value for the house & how much would this cost.

I know the situation is serious, i'm just wondering if anyone more knowledgable than me in the area (which wouldnt be hard) has any alternatives other than me losing my home?
 
See quote below from BOSI last September. Only two customers it appears will pay anything near 6%.

"Bank of Scotland Homeloans would like to clarify the following in relation to its fixed rate mortgage accounts:
  • Bank of Scotland Homeloans has circa 34,000 mortgage customers. Of those, approximately 3,500 customers are on a fixed rate.
  • The 3,500 customers who took out a fixed rate mortgage with Bank of Scotland Homeloans prior to July 2009 will roll onto the highly competitive variable rates of 2.50% gross or 2.75% gross when their fixed term ends.
  • In July of this year, the planned variable roll off rate increased for new business. Bank of Scotland Homeloans has accepted two new customers since July of this year who will roll off their fixed rate mortgages between July 2011 and July 2014. These will roll onto a planned variable rate of 6.00% gross – this planned rate may go up or down at any time.
  • The Bank of Scotland Homeloan fixed mortgage rate process is fully transparent and all customers are advised of a roll off rate at the time of taking out their mortgage - so customers have an informed choice to make when they take out the mortgage.
The impression given by reports today that existing customers are being penalised is misleading and disingenuous. Of the 34,000 Bank of Scotland Homeloan mortgage customers, only two may roll onto a planned variable rate of 6.00% gross. "
 
I was in the same position I came off my 3yr fixed rate in Feb. My rate is now 2.5%, I was worried I was going to be on a really high SVR. I asked about fixing again but the lowest rate they would offer to fix was 6% hope this helps
 
I'm with them too and come off a 3yr fixed (5.09%) this October. Not sure what rate I'll roll onto apart from the fact it'll be their SVR.

Thanks
 
thank you both, the relief reading your posts was unbelievable.
I contacted BOSI after reading them, and they confirmed that when i come off the fixed rate i will be on a rate of ECB+1.5%. Which is obviously 2.5% now.
I guess this teaches me to find out the facts before panicing. Thank you again
 
You must log in or register to reply here.
Back
Top