Time to tighten your belts....

[Obi Wan Kenobi]

Northern Rock are not going to be the only lender in trouble.
I think you are going to see a panic by many banks, building societies and financial lender, leading to less fixed rates available and at higher rates, credit card rates rising and an overall squeeze on the economy.

Already two other companies I know of, with two seperate banks have had 4 weeks notice that these banks are pulling the companies overdrafts.

Not good.

 

[irongirlof12]

glad I got in their quick with my fixed rate.

 

[Netty]

Obi, how will this as customers affect us. My situation is that I am in the middle of re-mortgaging with the HSBC(was with the halifax) and also have applied for a homeowners loan running along side the mortgage- to get some jobs done on the house. Will this affect me?

 

[Obi Wan Kenobi]

Obi, how will this as customers affect us. My situation is that I am in the middle of re-mortgaging with the HSBC(was with the halifax) and also have applied for a homeowners loan running along side the mortgage- to get some jobs done on the house. Will this affect me?

Give DebsUK a PM Netty.

 

[Boss Hogg]

My situation is that I am in the middle of re-mortgaging with the HSBC(was with the halifax) and also have applied for a homeowners loan running along side the mortgage

I wouldn't worry too much. I think you'll find that at the moment no-one really knows how this will manifest itself as far as the consumer is concerned.

I would certainly expect that Northern Rocks rates may well go up to counteract the issue they will have with the differential between the rates they have been lending at and those that they can secure themselves. That having been said, with the rise in LIBOR (the rate at which lenders borrow money from each other) in the recent weeks this would probably be the case with most lenders.

I think, from what I have read, that most lenders trackers have gone up and that some short-ish fixed deals have also gone up, but that long term fixed money is relatively unchanged.

To get back to your question, it depends what stage you are at with your lenders, if you have formal offers of rates, then you should see no difference. If however, you do not have formal offers yet, you may find that any rates promised are withdrawn soon, and increased ones replace them. Best to check with your lender, or broker.

 

[irongirlof12]

Netty , I have recently moved to HSBC fixed rate. I am pleased with the mortgage product.
I suggest you ring them, if you have been made an offer this usually lasts for 6 months, from date of offer, i think the media hype has caused more of a problem than there actually is.

 

[Andrew DEREK UK]

I think you are going to see a panic by many banks, building societies and financial lender

I think people should be very very careful what they write and post, firstly there isn't 'any panic by banks' that statement is completely misleading and incorrect and itself can lead to panic.

Today, -after the Northern rock, had to go to the bank of England for, 'liquidity' under the very strictly controlled UK banking rules, -there was 'panic' by customers of Northern Rock', I understand why, with peoples life savings, is a self fulfilling prophecy, there wasn't any problem before, the banks have to balance their books each night, Barclay's for example had to get a loan from the Bank of England few weeks back, there wasn't a panic then.

Now if I say ' There is going to be a petrol shortage' tomorrow and enough people believe me and drive to fill up tonight, it will again be again a self fulfilling prophecy.

Northern rock was fine until the panic today, that might cause an issue but the loan by B of E showed the B of E was very happy.

To say 'many' banks again isn't correct, some small banks might have some issues to deal with, from sub-prime lending in USA, but most small banks do not 'fund' themselves the way Northern Rock does, most fund a far higher percentage of their lending by their own customers deposits.

The big banks are fine, and again shouldn't be misrepresented by the 'many' statement, they are strictly controlled, and its true credit is tightening, and fixed rates might drift up wards due to this situation, but 'panic' spread causes far more damage.

For 'accurate' information I suggest people with worries read the BBC news website, its Q&A section on this and make your own minds up. Please though do not worry when you read 'inaccurate' posts.

 

[Andrew DEREK UK]

Obi, how will this as customers affect us. My situation is that I am in the middle of re-mortgaging with the HSBC(was with the Halifax) and also have applied for a homeowners loan running along side the mortgage- to get some jobs done on the house. Will this affect me?

I wouldn't worry too much. I think you'll find that at the moment no-one really knows how this will manifest itself as far as the consumer is concerned.

I would certainly expect that Northern Rocks rates may well go up to counteract the issue they will have with the differential between the rates they have been lending at and those that they can secure themselves. That having been said, with the rise in LIBOR (the rate at which lenders borrow money from each other) in the recent weeks this would probably be the case with most lenders.

I think, from what I have read, that most lenders trackers have gone up and that some short-ish fixed deals have also gone up, but that long term fixed money is relatively unchanged.

To get back to your question, it depends what stage you are at with your lenders, if you have formal offers of rates, then you should see no difference. If however, you do not have formal offers yet, you may find that any rates promised are withdrawn soon, and increased ones replace them. Best to check with your lender, or broker.

Netty , I have recently moved to HSBC fixed rate. I am pleased with the mortgage product.
I suggest you ring them, if you have been made an offer this usually lasts for 6 months, from date of offer, i think the media hype has caused more of a problem than there actually is.

FIRSTLY ,do not worry, any liquidity issue will not effect you if you have a good credit track record, mortgages are contracts and they will continue,

Secondally in the unlikely even of a bank going bust the main risk is on savings, you are protected by major banks up to the first £2k then a percentage to £30k.

The Bank of England has strict control on banks and they have to report things quickly, Media hype is mentioned, I feel the BBC reported things well today, some papers can cause panic.

Lastly mention is made of HSBC, -being the second biggest bank in the world people might move to it as in times of panic people go to a safe haven.

Barclays had to go to the Bank of England a few weeks back, for a loan, after approaching HSBC for help, It was a little late in the day so they couldn't help them out that night.

 

[paulh]

thank god i dont have a mortgage,and sold my NRK shares years ago.As the old adage comes to mind sell in may then go away
One of best places for money tusty Nationwide as a building society tighter rules govern there morgage book,think 70% has to be funded from own money as Rock was about 23%.
Plus lot of people ploughing money into NS+I
Paulh

 

[Boss Hogg]

Paul, the UK finance market is possibly the tightest controlled one in world. Northern Rock has not cheated or bypassed any of the regulations set down by the FSA or the DTI.

It is true that there are different rules that govern Building Societies and Banks, but please don't suggest that there is some inate problem with the banking industry, it isn't helpful to the public.

Moreover, the issues which have beset the lending industry in the US and caused the worry are linked to the sub-prime market, a market in which Nationwide are as active as any other lender.

 

[PoppyAnna]

Dont have a mortgage and I don't rent, so I'm not affected by these issues.
On the other side of the coin, with a bit of spare cash floating around would you buy NR shares? DH and I were talking about this last night....

 

[Netty]

I wouldn't worry too much. I think you'll find that at the moment no-one really knows how this will manifest itself as far as the consumer is concerned.

I would certainly expect that Northern Rocks rates may well go up to counteract the issue they will have with the differential between the rates they have been lending at and those that they can secure themselves. That having been said, with the rise in LIBOR (the rate at which lenders borrow money from each other) in the recent weeks this would probably be the case with most lenders.

I think, from what I have read, that most lenders trackers have gone up and that some short-ish fixed deals have also gone up, but that long term fixed money is relatively unchanged.

To get back to your question, it depends what stage you are at with your lenders, if you have formal offers of rates, then you should see no difference. If however, you do not have formal offers yet, you may find that any rates promised are withdrawn soon, and increased ones replace them. Best to check with your lender, or broker.

thanks
The hsbc have all the paperwork so the re mortgage should be sorted out by next week..