Nib self build tracker mortgage

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Buzzmolloy

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Has anybody out there experienced anything like the following?

I arranged a self build tracker with NIB in 2008. The total approved contained about €100k headroom to allow for contingencies. I will complete the build well within budget and wont require the full facility approved. At the initial meetings with the bank I disclosed my costings and requirement for some headroom and was advised that I would not be required to draw down the full facility

Whilst the build is progressing NIB make you operate a bridging facility. On completion of the build the mortgage is drawn down and a bullet payment is used to clear the bridging facility.

Here is the catch

NIB now state that the full facility approved must be drawn down. The bridging facility will be repaid and simultaneously any excess can be credited against the mortgage.

However the LTV ratio upon which the margin is determined would be calculated when the mortgage is initially drawn down and before any excess is credited against the mortgage despite the fact that all the transactions happen at the same time.

has anybody else experience of this

Buzz
 
so they are offering you 100K more on a tracker,

id take it and deposit it with 3 banks at good interest rates, you will probalby have borrowed the money at way less than you can now earn,
 
Buzzmolloy said:
However the LTV ratio upon which the margin is determined would be calculated when the mortgage is initially drawn down and before any excess is credited against the mortgage despite the fact that all the transactions happen at the same time.


Buzz
Click to expand...

Could this method of calculating your LTV together with falling property prices
now give you a LTV of 80% or more ?
 
Exactly my point, the bank think they will be able to worm thier way out of the offer by trying to force a failure of the 80% LTV test, hoping that the original valuation will have fallen by more than 15%
 
I would insist on your LTV being based on what you need not what you have approval for.

From Nib’s website the underlining is mine:

Did you know you can use the equity you've built up in your home to reduce the interest rate you pay on your mortgage? That's the beauty of our LTV Mortgage. In a nutshell, we calculate the amount you still owe on your home against the current market value of your home. This gives us your LTV ratio (Loan-To-Value). The lower your LTV ratio, the lower your interest rate and the greater your savings.

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This article might also help your case:

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