It is said that money is the root of all evil. But over the past few days I've come across things that challange that theory.
My hypothesis, if you will, is that money is not the root of all evil, it is actually just the leaves. I have come to the conclusion that mortgage companies are actually the root of all evil. Let me explain:
When I bought my house I took out a 2 year fixed mortgage, the repayments are fixed no matter what happens to interest rates. Once 2 years are over the mortgage reverts to a rate that is much greater than what you were paying, which also tracks with interest rates. Well last week i received a letter from my mortgage companies evil lair, reminding me that the 2 years fixed would be over in April.
Aside :April! Bloody hell, has it be been that long already. My house must actually be built on a spacial disturbance visable only in the 4th-dimension, for time to pass this quick. I half expect Jean-Luc Picard to ring my doorbell at any moment. Which would be another physics defying feat in itself as I don't have one. ;-)
My current mortgage company also sent me an offer of another fixed rate (more than I'm paying now, but less than what I would pay once my original is up). Plus there are no fee's to pay for setting up this mortgage.
This offer is only valid for 7 days. Hmmm, I wonder if they are trying to rush me into a decision. Looking around I can get cheaper fixed rates, however there are fee's involved in setting up each that reduce the savings somewhat.
Then there are the problems of switching before the 2 years are up. There are heavy penalities for early repayment (and hence switching mortgages). Which mean if I wanted to setup a different mortgage now it would actually save me nothing (in fact costing me more). So I can't actually switch until the 2 years are up. Which is actualy 3 months away, when all the current deals will have changed.
It's all a bit like a game of Pontoon, do you stick, or do you twist. Who knew that such problems await the house buyer after they have owned there house for awhile. I certainly didn't and while I won't lose any sleep over it all I can't believe how complicated it all is. Also I can't believe how much you have to work out before switching and that tactics employed by companies to muddy the waters as it were.
Therefore I nominate mortgage companies as the root of all evil, while thanking them for lending me the money to buy my house in the first place!
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4 comments:
Haha... that equation is right on the money.
I wouldn't accept the new offer. They want to keep your business, so I bet they'll give you another good offer if you don't accept their attempt to bully you.
If you'd like to speak to a good mortgage advisor, I know one (mUrt's best friend, Richard).
What gets me is the fact that they must be making immense amounts of money as it is, with house prices being so insane at the moment.
And they want more?!
I totally understand. We went for variable rate ourselves so we didn't get any nasty shocks, but the repayment penalties were equally nasty. I hope you can get a good deal whichever way.
I half expect Jean-Luc Picard to ring my doorbell at any moment. Which would be another physics defying feat in itself as I don't have one. ;-)
Heehee!
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