To remortgage or not to remortgage

When your mortgage deal comes to an end, you may want to shop around for a new product. This is known as a remortgage.

In these hard times do you remortgage to get a better rate or do nothing and stay with your current lender after the end of a fixed term interest rate on your mortgage, say two or three years, will mean that you revert to the standard variable rate is a question you need to ask yourself.

If the variable rate is relatively attractive, which is it at the moment you may not want to bother remortgaging. And if you have not built up much equity in your property, you may not be able to remortgage, as many lenders now insist on a minimum of 20 to 25%. But if you have a lot of equity in your property, you may well be able to remortgage onto a more attractive interest rate which could be better than the standard variable rate.

What if you have to remortgage to move house. In such a situation, even if your lender will allow you to transfer your home loan in theory, it will probably require a valuation of the property to ensure it meets its standards, with property prices falling so much in the past year, you could be hopeful.

Remortgaging needn't only occur when your mortgage interest rate comes to an end. Some people take out a new mortgage simply to save money on their monthly repayments. For example, you may take out a fixed rate mortgage only for the interest rate to plummet, leaving you stranded on a higher rate. Remortgaging to a more competitive rate in these circumstances may make financial sense. Bear in mind that remortgaging is not a cost-free process though. Your current mortgage may carry penalties or charges if you try to leave it early, plus there will probably be costs associated with the new deal, so factor all of this into your decision.

In the current economic climate with slowing house prices and lenders now charging higher interest rates, a remortgage should really be driven by need to do so. As a result of the credit crunch, a number of lenders pulled their larger loan-to-value (LTV - the amount lent as a percentage of the property's value) mortgages in spring 2008. All 125% mortgages were abolished, meaning that borrowers could no longer obtain loans for more than the property's worth. Although this wasn't good news for first-time buyers, it also reduced the chances of borrowers that were already on such deals would be able to get similar percentage loans when they came to remortgage. You may find that you need to build up more equity in your property before you can remortgage as most lenders will only offer a LTV of 80% to 85% at the moment for a better deal.

Lenders are being tighter with who they lend to and how much they lend given the current economic situation, so if you bagged yourself a good mortgage deal a couple of years ago, don't necessarily expect a similar rate this time round.

To summarize, to remortgage or not to remortgage, in my opinion as the author of this article I believe if you have enough equity in your property around 40% then there are many good deals to be had, but if you are like the majority who do not have enough equity in their property then the best route is to stay on the standard variable rate and benefit from low monthly mortgage payments until rates start to rise which is a question we are all asking.


Source

Lee: ‘We’re mortgaging the future’

U.S. Congressman Chris Lee wants his constituents to know he’s read the 1,100 pages of the current health care reform bill — and his objections to it are based on research and business experience.“One thing I have done is do my homework,” he told local officials and business leaders at the Livingston County Chamber of Commerce Friday. “I’m a big believer in the fact that it’s easy to say “no” to something, but it’s more important to have answers and solutions to how to reform the system without burdening small business owners.”Lee worries that government isn’t up to the task of managing a complex health insurance system. Private industry, with its drive to control costs and seek efficiencies, will always do a better job, he believes. “The U.S. spends two times per capita what other countries spend on health care. I look at this as an opportunity to cut out lots of waste, fraud and abuse.”Lee sees health care reform as a way to help make American businesses more competitive in the global market. Efficiencies in health insurance will ultimately result in more jobs and lower prices on exports.“I should be voted out of office if we can’t get real reform done.”In the 1,100 pages of the current health care reform bill, known as H.R. 3,200, there is “not a single paragraph” addressing doctors who practice defensive medicine, Lee points out. The American Medical Association estimates unnecessary tests and treatments prescribed to avoid medical malpractice lawsuits cost consumers between $84 and $151 billion a year. Among other measures, the AMA supports a $250,000 cap on non-medical damages.Why doesn’t the bill address liability reform? “The current administration accepted $80 million in contributions from the personal injury lobby in 2008,” Lee claims.The Congressman also questions the number of uninsured — 47 million — that Democratic leaders claim are uninsured. He says 10 million are illegal immigrants who should not qualify for benefits. Several million more are recent college graduates and other young adults. Lee believes those young adults could have access to health care if insurance companies offer riders to keep them on their parent’s health plans until they’re 26 years old.Lee has sponsored an alternative House bill called the Medical Rights and Reform Act which includes provisions to improve information technology systems, offer incentives to states that reform insurance markets and extend flexibility and control to lower income families.He also supports allowing insurance companies to cross state lines and for companies which operate in several states to pool their employees into a single plan in order to save money.“I want to take real dollars out of the system instead of just sharing costs,” he said, pointing out that the current reform plan is like a “shell game,” where public insurance beneficiaries will be subsidized by private insurance companies. Present public health care systems like Medicare and Medicaid keep costs down for their members, but those costs get passed on to other patients. A public health care plan would only pass those costs on to taxpayers, he contends.As an example of government waste, Lee described H.R. 1018, the “Restore Our American Mustangs Act” which would create 19 million additional acres above an existing 30 million acres set aside on federal land for free-ranging wild mustangs and burros. The $700 billion bill would also include a horse census and birth control programs.“I tell my Democratic colleagues, ‘We’re mortgaging the future of this country. Please stop.”During his visit Friday, Lee also visited with physicians and staff at Tri-County Medicine in Geneseo, appeared on WYSL’s Bill Nojay Show and toured the Lakeville Grain Elevator.


Source

Have you been tempted to remortgage yet?

For many, remortgaging had become as much a part of their regular financial review as filling in the insurance forms.
But the credit crunch put paid to all that with banks trying to navigate away from the heavily indebted consumer in a bid to rebuild their own credit worthiness.
While some state owned banks are under pressure to lend more, with interest rates falling many people now seem happy to stick with their SVR after they come of their discount period.
Remortgaging was never free, was often time consuming, and lenders are still reluctant to lend at high loan to value rates.
Coupled with falling house prices, this has closed the door on anyone hoping to secure more credit against the value of their home.
HSBC though has launched a new offer at a record low rate in a bid to lure out any potential remortgagers (see our earlier story here). As long as they have a 40% deposit, that is.
With a deal so low that it should more than make up for costs associated with remortgaging – although there is the minor issue of a £1200 fee – the bank is clearly hoping to breathe new life into the remortgage market.
The lenders say the main reasons lending levels are so low is that there is little demand. But I think the true picture may be a little bit more complicated than that.
I did recently think about remortgaging. I have a little pot of money in a bank account with an introductory bonus period that is about to expire.
With saving rates now so low I thought I'd do the sensible thing and pay it into my mortgage. I thought it might be a good idea to reduce the term of my mortgage by a few years while I'm at it.
In theory at least I meet the lenders’ requirements even in this difficult market - with enough equity to secure a 70% loan to value deal.
To my surprise the application was refused on the basis of a rather measly valuation; something that apparently you cannot appeal.
Reading the personal finance pages it seems I'm not alone and others are also being refused mortgages.
Are you one of them? Or are you one of the people happy to just keep paying the current rate?
Are you looking around again as rates are starting to tick lower?
Or were you one of those people that rushed to lock yourself into a fixed rate earlier this year?
Did the application go as smoothly as previous applications?


Source

Remortgaging to give my furry friend a chance

T was probably diabetes, serious but not life-threatening, the vet said as he handed my wee dog Jessie back into my arms. She had been sedated for tests. There was definitely something wrong with her. She had been drinking what seemed like gallons of water and peeing in the house.
Every time she did it, she looked sorry, her eyes wide with worry.

I knew by then that she couldn't help it, so there was no point in scolding her.

In the eight years since we had been together, she had barely put a paw wrong.

Jessie the west highland white terrier was the first dog I had owned as an adult and I loved her so much I also bought her a sister, Bonnie, to keep her company.

You never have a bad day when you live with a dog – or rather if you have the worst day in the world (Shock. Husband has girlfriend. But there's more. Shock, horror. Girlfriend is pregnant.) they always make it better. The husband was the loser.

Cheeky, intuitive, loyal. Their love is unconditional. Whatever happens in your day, they welcome you home with unsuppressed excitement.

Like my parent's westie, who lived for 18 years, I expected Jessie to live forever paid the vet's bill and he sent me off to see a specialist for more tests. Just in case.
Jessie was losing more weight but she could still wag her tail like a trouper.

The specialist also thought it was diabetes but suggested an ultrasound ($280), radiographs ($255) and a body function test ($165). More tests than any human in my family had ever had. Certainly more expensive.

He walked back into the consulting room with wee Jessie, groggy from drugs and with her fur shaved on one side. She had cancer, a tumour on one kidney.

It is rare in dogs but it could be worse, he said. Dogs can live long and happy lives with one kidney. He said they could operate and remove the cancerous kidney.

I didn't need to consider it. I booked her in for an operation and didn't even ask how much it would cost, didn't even care.

I paid the bill of $1117.05 and went home to wait. Four days later we went back.

I can still see Jessie's look as she turned her head and gazed after me over the vet nurse's shoulder as she was carried into the surgery area. Dogs are more intuitive than humans. She knew more than I did.

I left her in the care of the experts along with a $2000 deposit. They gave me a Take Home Information Sheet. That was a hopeful sign. She had her operation the next day and everything looked good.

The receptionist was very helpful. Of course I could talk to the surgeon, she said. They encouraged people to talk to them about their patients. But he never returned my calls.

Then Jessie died. Of course it wasn't as sudden as that. But as her condition deteriorated, no one said she would die.

You might think I would have worked it out for myself but I trusted the experts.

Two days after the operation I got onto the surgeon. I made notes as we spoke and have kept them. The cancer may have spread to her brain, he told me. She'd had a seizure – but I knew that, didn't I, he said. I think I would have remembered if I had been told.

The surgeon was totally offhand. Obviously he preferred dealing with unconscious animals than people who can talk back. I wanted people to know who he was but the lawyers would only have taken his name out.

It was touch and go for another two days. I hoped for a miracle. There wasn't one. The nurses called me in the middle of the night and by the time I got there Jessie had died.

I hugged her body, which was still warm. Four days' treatment cost me $11,767.60. Yes, it was a fortune. I had to remortgage the house.

I would have been happier if it had saved Jessie's life but I don't begrudge one cent of that money. I had to give her the best chance that I could while the vets were saying that she may have survived.

I cried for weeks. I report on horrific crime and do not cry. But I still cry as I write this. I'm not crying about the cost but, as time has passed, I have become increasingly bitter that perhaps the vet hospital strung me along to make money.

I like to think I was not keeping her alive for myself. If any of the vets had said there was no chance, that my dog was in pain and the best thing for her was to have her put down, I would have done it.

The only thing to do was get another westie to keep Bonnie company, wee Hinnie – a Geordie term of endearment, and she is living up to her name.

Folks who don't have dogs think we are completely mad. It's a shame as they don't know what they are missing.

Would I do it all again if my other two dogs became as ill? You bet. I would do anything to save their lives.

But this time I have pet insurance. All it will cost me is the $100 excess. And I would find a different surgeon, one who didn't bark and had a bedside manner.


Source

Cruel conman jailed for tricking consultant out of £350K

IT WAS an e-mail that was too good to be true.

For anyone willing to help a Nigerian transfer $300 million into a UK bank account they would receive up to half of the fortune.

But for leading consultant surgeon Fawzia Ashkanani the temptation was irresistible.

The breast cancer specialist remortgaged her house and borrowed thousands of pounds from friends and family to invest more than £350,000 in the get rich quick scheme which turned out to be an internet scam.

Nigerian conman Chinaenye Mokelu, 44, was jailed for five years for his part in the phishing spam e-mail which was said to have “ruined” the consultant’s life.

Describing the impact of the fraud on the surgeon at Dumfries Infirmary, Michael Fraser, prosecuting, told Basildon Crown Court: “She said how this whole episode has left her feeling upset with a huge feeling of guilt because she has let down members of her family and indeed close friends.

“She is struggling to cope with repaying the £210,000 remortgage.

“It has also had a profound psychological impact on her. She has considerable difficulty in relating and talking to her patients because this matter has caused her considerable embarrassment.”

The court was told “gullible” Miss Ashkanani saw the opportunity, presented when the e-mail landed in her inbox in August 2007, as a way to finance her dream of setting up clinics in the most deprived areas of Africa.

Mr Fraser said after making contact with the sender, she was asked to pay £4,500 to broker Mokelu, to enable the transfer of funds.

As part of the elaborate fraud, Kuwati-born Miss Ashkanani travelled twice to London to meet several of the gang of fraudsters – who have never been traced by police.

During one meeting in a Holiday Inn she was shown a suitcase full of fake $100 notes. In September 2007, Miss Ashkanani was told the sum of £210,000 was required to release the funds.

So desperate was she to get hold of the promised £75,000,000 reward she raised the amount by remortgaging her house.

The conmen even mocked up and dispatched a document which appeared to be a £150,000 transfer to her account purporting to be from US Citibank Group.

Then came a phone call demanding £750,000 in tax. When Miss Ashkanani said she could not find that amount, the court heard, she was told “raise as much as you can” and threatened with police investigation if she pulled out of the deal.

She convinced her brother to lend her more than £50,000 which was paid into a Lloyds bank account controlled by Mokelu.

The married father-of-two – whose wife and seven and 14-year-old daughters have returned to Nigeria – was arrested as he withdrew £20,000 in cash from the fraudulent account. When police searched his home in Grays, Essex, they found a suitcase full of fake cash and a counterfeit Nigerian passport.

They also found a mobile phone with Miss Ashkanani’s work, home and mobile numbers saved under the names “Miracle 1, Miracle 2 and Miracle 3”, the court was told.

During some 18 months, Miss Ashkanani handed over £352,937.

Mokelu was sentenced to a five-year jail term – four years for conspiracy to defraud and another year added on for using a fake Nigerian passport to set up a fraudulent bank account.

Source

New buyer mortgage deals 'creep up' as remortgaging drops

May data from the Bank of England confirm the trend lenders have been seeing.

With standard variable rates so low, home owners are happier to stick there, rather than remortgage onto high fixed rates – despite warnings that the moment the Bank of England increases rates variable rate deals will jump, as will fixes.

Fixed-rate mortgage deals have already started to rise.

Falling house prices putting some homeowners in negative equity or leaving them with very little equity is also creating a brake on remortgaging.

Last week rating agency Fitch warned 35 per cent of borrowers do not have enough equity to secure a remortgage.

In May there were 30,984 remortgage deals – 9.8 per cent down on the six-month average.

Andrew Montlake, at mortgage broker Coreco, said: "I am concerned that the number of remortgages has fallen. Fixed rates are rising and anyone settling for short term gain on a lender's SVR could be in for some long-term pain.

"People wanting to have their cake and eat it could fix part of their mortgage and leave the rest on a tracker, which will at least give some level of security without substantially upping their current payments."

The number of house purchase deals stood at 43,414 – up 21.7 per cent on the six-month average.

However, high deposits needed to make a purchase are still holding back many first-time buyers from taking advantage of low house prices.

The mortgage market as a whole, however, remains anaemic, with lending growth dropping from over ten per cent two years ago to 1.4 per cent now.

Mr Montlake added: "Slowly but surely, the number of new home loans being approved is creeping upwards, reflecting the growing confidence in the UK property market.

"Some people were expecting better figures but let's not kid ourselves, it's still very difficult to secure mortgage finance at higher LTVs."


Source

What To Expect With An Offset Remortgage

Like other offset mortgages, the offset remortgage is much in demand, as UK home buyers wake up to the benefits of flexibility. The best offset remortgage deals have all the flexible features of other offset deals, with a couple of added incentives for remortgage customers. With flexible remortgages, home buyers can expect to save on a couple of fees that other home buyers might have to pay. These include legal fees and valuation fees, for example. Some offset remortgage lenders also wave arrangement fees and many may offer insurance products as added incentives for flexible remortgage customers.

An offset remortgage will also usually be portable, which means that if buyers move to another property they can move the mortgage without incurring additional mortgage fees. And an offset remortgage will also allow borrowers to overpay, either by paying in a lump sum to the mortgage account or by making a regular overpayment. Offset remortgage customers should also look out for underpayments, as this might be a useful feature if circumstances change. However underpayments and payment holidays could increase the mortgage term and/or the total amount payable.

Source