Personal Loans & Fixed Rates

[Jaydee]

Putting Personal loans into a mortgage after first year
My partner and I are in the process of buying a house. My parents are taking out a personal loan to help us with some of the costs, mainly furnishings. We will be paying the loan off and hope to put the balance into our mortgage after year 1.

Has anyone tried/done this? Have you had any difficulties or was it straight forward.

1 year fixed rates
We have been offered a 1 yr fixed rate at 3.04%. I am happy with this but worried about what happens at the end of this period. Obviously we have to renegociate but are we more likely to get stung with a high rate because our lender has us tied into a mortgage with them? Can we move lender?


Thanks in advance!!!

Basically I am concerned that we will have very limited negociating power.

 

[CCOVICH]

Putting Personal loans into a mortgage after first year
My partner and I are in the process of buying a house. My parents are taking out a personal loan to help us with some of the costs, mainly furnishings. We will be paying the loan off and hope to put the balance into our mortgage after year 1.

Has anyone tried/done this? Have you had any difficulties or was it straight forward.

Haven't tried it, so can't comment from experience.

Does your mortgage agreement sepcify a minimum term during which you cannot change the original terms of the mortgage?

What will your loan-to-value ratio be when you take it the mortgage (what are you approved for?)? Will adding to the original sum borrowed increase the LTV over what you were originally approved for?

It may make more sense just to take out a personal loan to repay your parents as this will not affect your mortgage and will ensure that you do not borrow over the long term for items such as furniture etc.

Note that you will have paid hardly any capital off your mortgage after year 1, so unless the value of the property increases (significantly?), you may not have any scope to remortgage/equity release.

1 year fixed rates
We have been offered a 1 yr fixed rate at 3.04%. I am happy with this but worried about what happens at the end of this period. Obviously we have to renegociate but are we more likely to get stung with a high rate because our lender has us tied into a mortgage with them? Can we move lender?

Some fixed rate offers specify that you will revert to a certain rate after the fixed term expires. I'm not sure if this is 'wrong', if you agree to the ts and cs, it probably isn't, so read the ts and cs carefully and ask your lender what your options will be at the end of the fixed period.