Egg fixed-rate mortgages launched by Finance News Bulletin
- Home
- »Egg fixed-rate mortgages launched
Published: 26/09/07
With recent rises in interest rates beginning to touch, the provider is to present a two-year and a three-year deal, both with a fixed-rate of 589 per centAfter the fixed period, borrowers will revert to Egg's standard variable speed of 694 per cent
The two-year offering has an arrangement charge of £899, which lowers to £749 on the three-year dealStephen brilliant, head of lending and insurance with Egg, said the mortgages will be of interest to people looking to protect themselves from a variable market"We've launched a competitive, great value product with fixed repayment costs and defense from any further changes in interest rates over the next two or three years,"
Visit original article:Related Articles:
The buy-to-let timebomb - Published:30/10/07
Like so many young professionals eager to cash in on Britain's possessions boom, Paula Collins, a 26-year-old recruitment consultant from London, thought her money would be safelevel BROKE: Thousands of investors in metropolis centre buy-to-let flats have seen their equity vanish as prices fall and discounts turned out to be falseThe buy-to-let bubble is set to burst, says a appreciated City analyst understand writing the report and have your say: Buy-to-letThinking about investing in property This is cash has the best buy-to-let information and advice >> Buy-to-let tipsThe buy-to-let marketplace was booming and the contract from a Manchester developer seemed too good to pass onThe two-bedroom flat in the Castlefield region was appreciated at £175,950, but the developer was offering a 15% discount, taking the cost down to £149,500 - and best of all, no deposit was requiredHe would pay the 15% deposit Paula just needed to cover her legal costs and stamp duty If it sounded too high-quality to be true, it wasAfter 18 months, in which Manchester, similar to many northern cities, has seen a huge oversupply of new city centre apartments, Paula's flat is now worth just £140,000Her mortgage costs her £900 a month, but she receives only £600 a month in rent That's when she could find a tenant Now the flat is deceitful empty, so Paula has to base up £900 a month just to cover costs'The offer seemed too good to refuse at the occasion My boyfriend had some buy-to-let properties and I determined to do this one as a long-term asset, but I hadn't anticipated that the possessions would be so debilitating,' says Paula'I paid such a high cost, partly because independent valuers told us it was worth a lot more, and now I can't put up for sale because there are so many apartments in the area'I'm at a frantic stage I've lost an enormous amount of money - about £14,000 I'm getting wedded in a few weeks, but this has put an enormous strain on the relationship and led to endless pressure and tears It has greatly exaggerated our chances of being able to buy a house of our own now, and it has certainly left me disillusioned with the buy-to-let marketplace'Paula is not alone There are 900,000 buy-to-let landlords in Britain, many spurred on in the past few years by rising home prices and the accessibility of mortgages modified for buy-to-let investorsMany saw it as a get-rich- quick system in a buoyant market But interest rates have risen, home prices are falling and people who have borrowed beyond their means, or didn't set aside cash to wrap periods when the property is empty, are finding themselves unable to pay the mortgage and being forced to hand back the keys to the bankLast week, Gordon chocolate's adviser on the accommodation market, Kate Barker, confirmed that the buy-to-let marketplace is heading for a slump She said that higher interest tax, provoked in part by the sub-prime mortgage crisis in the US, joint with collapsing rental values, meant that petty property speculators were 'vulnerable'She also indicated that the Bank of England was unlikely to cut interest tax to help the marketplace recoverFor Britain's buy-to-let owners that is disastrous news For these are not slick-suited property tycoons with cash to burn: they are ordinary, middle-class populace hoping that bricks and mortar would be the safest way to spend for their future - perhaps to help pay for children's institution of higher education fees, or as a retirement nest-eggAll too often, they have been lured in by the developers with the promises of foolproof guarantees'The greatest problem is in big developments in cities counting Leicester, Manchester, Birmingham and Nottingham,' says Mike Goddard from Belvoir Lettings, which deals with 30,000 level lettings across the state 'The developers inflate sales prices and offer incentives such as paying legal fees or stamp responsibility, or they promise grossly exaggerated rental returns Novice buyers are drawn in and find themselves making a loss We choose up the pieces''Some developers offer a guaranteed rent for two existence to suck buyers in But when that time is up, the buyer is unable to get anything like the same rent on the open market and they may get the twice whammy of finding their flat is worth less than they salaried for it'Part of the problem is that so many investors have joined the buy-to-let bang that the rental market is simply oversupplied amazingly, 300,000 buy-to-let mortgages were taken out last year alone, creating one million properties financed on alike deals Yet the figure of landlords trying to off-load properties has jumped to its uppermost level in two years'So-called property experts, who charge a luck for their weekend seminars where they dazzle simple buyers with the science of buy-to-let, persuade people to invest their existence savings in something where the numbers now don't stack up'The result Not only have rental returns fallen in most areas, but outside London, property principles for rental flats have plummetedSmall speculate, then, that many small- scale speculators have had their fingers poorly burned When over-stretched buy-to-let investors fright, their first port of call is often auction houses Allsop, the state's biggest residential auctioneers, reports that out of 450 plenty in a big sale in London and Leeds last month, 45% of properties were repossessions after owners defaulted on their mortgage payments About half of those were buy-to-let investment properties'We anticipate the state of affairs is going to get a lot not as good as,' says Allsop's Gary Murphy Dominic Higgins, from Property Investment Advice & organization, agrees: 'The buy-to-let situation, especially in northern metropolis centres, is far more serious than people think A lot of investors who got set rate mortgages in 2004 or 2005, when interest rates were low, are coming off them now and could be in for a shock'People have been mis-sold savings So-called property experts, who charge a fortune for their weekend seminars where they prevent from seeing unsophisticated buyers with the science of buy-to-let, persuade people to spend their existence savings in something where the numbers just don't stack up,' says Higgins'One company tells populace that if they refuge't got enough money for a deposit, they can borrow it by paying it on their credit card That's horrendous advice'This is Money is packed with information, advice and tools that can help you get ahead and put aside moneyIt's a state of affairs that Neil Lyons, an electrician from Devizes, Wiltshire, knows only too well Tempted into buy-to-let by a self-appointed property guru called cut Rampley-Sturgeon from Activation Enterprises, who has since left bankrupt, Neil, 46, bought three flats at Old Brewery district in central Cardiff for between £127,000 and £157,000 eachHe intended to put up for sale before completion and make a quick profit But four years later, they are all still up for sale with no takers in sight, and are now each worth about £10,000 less than he salaried To make matters worse, he pays £1,000 a month mortgage on each possessions yet receives only £600 a month rental profits, before any running costs have been deductedAlthough he has seen better success with his two asset flats in Corby, Northamptonshire, which have risen in worth from £49,000 to £100,000 in three years, Neil blames the failure of his other metropolis centre investments on: 'My own naivety, developers' and agents' lies, as well as terrible oversupply'Don't believe that the higher up the chunk, the more the level is worth, because when you re-sell, they all go on at the same price''I've learnt a lot of lessons about buy-to-let,' he says 'Don't consider what anyone tells you about rental income - go and look, talk to lettings agents and do the arithmetic yourself Don't buy in blocks with more than ten apartments Don't consider that the higher up the block, the more the level is worth, because when you re-sell, they all go on at the same price'Don't believe it's a race and let anyone fright you into buying, and unless you have 40% cash to put down, don't even believe about it In fact, don't bother with buy-to-let on all on the moment'His knowledge is echoed by tens of thousands of small-time investors across the country Websites such as Property wind or House Price collide provide a forum for buy-to-let investors who have come unstuck to mourn their losses - and compare details of disastrous developmentsAt The Lofts in Huddersfield, flats have dropped in worth by 28per cent At Cranbrook House in Nottingham, a flat that sold for £204,000 in 2003 sold last imposing for £120,000The problems are not just in the North At Henry Laver courtyard, in Colchester, Essex, a flat that sold for £225,000 last day was going for £145,000 at auction recently Kate Faulkner, who runs the self-governing online advisory service Designs On Property, says: 'It's the worst place I've seen for a long time in the buy-to-let marketplace'She advises that only those who have enough capital to ride out the market for the next ten to 15 years should take the risks linked with buy-to-let The trouble is, even those who thought their investments were for the long word are often caught not readyTam Macdonald, 64, thought he was in it for the long word with his buy-to-let terrace houses in Liverpool But after a run of bad fortune, he was compulsory to sell up He bought eight houses for £22,000 to £45,000 each in 2002 and 2003, aiming to rental fee them to tenants on Income Benefit 'I saw it as a method of providing a good, steady income to enhance my pension,' says Mr MacdonaldBut the management corporation became unfocused by more lucrative developments in Spain and failed to gather rents or alert Mr Macdonald when his tenants moved out 'I had one tenant who didn't pay rental fee for over a year, but the organization company did nothing about it because he was a famous Liverpool drug dealer with armed heavies'Another, an refugee, got the hint he was being thrown out of the country, so he barricaded himself in one of my houses with what appeared to be an M16 ransack The street was closed down, the house was bounded by police - but the gun was a replica I was unaware to it all,' says Mr MacdonaldOne of his houses, built on an aged coal mine, was falling down, and another house was served a compulsory purchase arrange for demolition - the correspondence was posted through the door, so the tenant read it, right away moved out, and Mr Macdonald didn't find out for months that his house was sitting empty'finally I'd had enough and sold the houses at auction,' he says He was one of the fortunate ones He bought when prices were near to the ground, so he still managed to make a small profit, but it was barely worth all the anxiety Others who have bought at the top of the market will be much less fortunateIndeed, the market has now got so bad that John Socha, associate chairman of the National Landlords friendship, warns that virtually no buy-to-let investor now can wait for to make a profit - and certainly not the small-time speculators looking to construct up a shell egg'The price you're paying versus the rent you're getting is very unlikely to service the money owing, and that's the container in most places in the country,' he says Professionals, says Socha, look at hire income, not end profitNovices do the opposite 'They forget that they will have to pay capital gains tax when they put up for sale, and that when the developer or manager tells them they will receive a certain amount of rental income, they put on't mention all the costs you'll have to deduct such as maintenance and - if you're in a block of flats - the service accuse and ground rent'possessions sceptics are predicting a serious downturn in the housing market, but will there be a crash'You have to be smarter now,' says Tim Crighton from possessions Secrets, a buy-to-let advisory website 'Five years before, you could buy in a novel development, get a bit of a discount and not go far wrong Now, if you over-stretch yourself and try to make a rapid buck, that's where you can come badly unstuck'With the marketplace flooded, rents falling and no hope of a slash in interest rates to boost sales, it is advice that will come too not on time to put aside many thousands of Britain's buy-to-let investors who had sought safety in bricks and mortar, but were rewarded with only heartache and miseryI'm with Stephen Hulton, let's see the back of the BTL brigade Tenants should exist in council houses or housing friendship properties They've had too good a choice for far too extended now Let's hope that the councils and tenant relations can cope with the demand once the repossessions really take holdWell said,Rick of London Property in populace's minds is so hard it's better than £ notes, Who ever heard of any one charitable 15% discount on £ notes and paying any expenses concerned, that alone tells you the truth about the value of any tangible thing, it's all a gamble and financiers will tell you it is a matter of timing, clearly the developer got his timing rightThere'll be no collapse in the BTL marketplace, only a healthy alteration, perhaps a bit healthier than the market as a whole A fall in home prices and panic selling simply affords more easy buying opportunities for the crafty investor What we need is intervention from the narrow authorities: a tax on the BTL sector and other multiple house ownership, and stamp responsibility liability moved from purchases to sales (ie tax on income not expenditure)It's greed that gets people in this mess If it all worked out for them they would be bragging about how clever they areThese buy to let speculators should have been watching Paragon(BTL specialists)share cost their shares have collapsed over the last yearYears before someone gave me some sound advice: they supposed remember your investments can fall, as well as plummet Give it a few months, and once the herd of the get rich rapid dreamers have in use a bath, I should step in and buy them out cheapUtter nonesense: they were in it for the promise of easy money with little work I put on't complain when "expert" tips on horseracing don't approach inneither should they As for retirement nest-egg nonsense, the genuine slump will be when all these 30somethings all reach retirement at more or less the same age and all try to sell at the same timeAnd finally, certainly no-one would be so stupid to believe a £25k reductionobviously that was a made up cost in the first placeSelect a loan term 12 months (1 year) 24 months (2 existence 36 months (3 existence 48 months (4 existence 60 months (5 existence 72 months (6 existence 84 months (7 existence 96 months (8 existence 108 months (9 existence 120 months (10 existencePlease select a type of insurance Life insurance house and contents Car Breakdown services Health - checkup Health - dental Travel Pet -.
Read More: The Buy-To-Let Timebomb >>The Perfect Savings Account - Published:03/09/07
Since 1998 my savings have wended their method through accounts from Cheltenham & Gloucester, Egg, Intelligent Finance, ING, Icesave and Sainsbury's So, on average, I've only reserved my money in an account for about two years before its rate has slipped to such a degree that I've decided it's valuable going elsewhereOf course, moving your cash like this can be a hassle First of all you have to find a novel account and then go through all the money laundering hoops to unlock it Finally, you have to transfer your money, during which time you'll misplace a few days' interestHopefully, this last difficulty will be reduced when the banks eventually get round to speeding up transfer payments The present 3-day process was due to be replaced by November of this day but it was recently announced that the timetable had slipped a further six monthsWhile this obviously goes without proverb, I'm always amazed at how many accounts disburse less than the base speed The top accounts at the moment are paying 63% AER But a search for variable rate financial records without bonus rates revealed that from a option of over 400 accounts, only 10% of them pay better than the base rate (currently 575%)Furthermore, semi of them pay less than 39% After basic rate tax, this means you're losing cash in real terms as your rate of interest is less than price rises Indeed, the account I had with Cheltenham & Gloucester all those years before now offers a whisker over 4%, demonstrating just how distant once competitive accounts can fall by the waysideNormally, I similar to the word ‘bonus' But not when it's in close proximity to the phrase ‘savings explanation' extra rates are typically 05% or 075% and last for up to six months Once they are taken out the equation, they turn a high-quality account into a mediocre one luckily, I've found that it's very rare for an account with a bonus rate to offer a significantly improved rate than the best non-bonus accountsI'm happy to open a novel account every once in a while, but every six months is a bit too frequent Still, it will be interesting to see what impact the novel transfer payment system has on the curse of the bonus rate When it becomes easier to move money around without losing interest, it might become less profitable for banks to present these incentives and rely on our apathyTiered tax tick me off only slightly less than bonus rates An explanation that combines the two is really taking the Michael There is no real cause why tiered rates require to be applied to any account Again, luckily, it's rare for an account with this feature to be among the top payersFor a few years now, easy access accounts have ruled the roost and become aware of accounts have been a dying breed But lately, we've seen a few accounts that offer high-quality rates but contain the following depth charge in the little print -- no interest is paid in any month a withdrawal is madeYuk For a high-paying account this translates into a defeat of around 05% in interest for each month in which you make a withdrawal So, even one withdrawal makes the interest rate unappealingThere has been one good trend in investments accounts recently and that is improving interest rate guarantees Not long before, most guarantees would last for just twelve months, and were rarely found among the top accountsThese days, some banks are prepared to make promises that last until 2011 Indeed, most of the top financial records are actually offering a better rate than their guaranteed minimum How long this degree of difference will last remains to be seen© patent 1998-2007, The Motley Fool Limited All rights reserved This material is for individual use onlyPlace of Reg: England & Wales Company Reg No: 3736872 storage bin Reg No: 735 7818 01 Registered Office: 30 huge Pulteney Street,.
Read More: The Perfect Savings Account >>Alliance & Leicester current account available for limited period - Published:03/05/07
wwwmoneynewscouk > Banking > Alliance & Leicester present account available for incomplete periodAlliance & Leicester has brought back its premier present account for a limited period of time onlyEnjoying fixed monthly expenditure of between £10 and £250, the Alliance & Leicester account is designed to encourage people to put aside set amounts on an annual foundationRoss Dalzell, manager for savings at the group, said that the account would "start" savings habits and that by the end of the term, they would have "saved up a pleasant little nest egg""This is a great time for clientele to switch their current account to.
Read More: Alliance & Leicester Current Account Available For Limited Period >>