Which Northern Rock Am I?

Northern Rock has announced it is splitting into two banks. Mortgage borrowers will receive a letter  advising them which bank they have been moved into.

If you receive a letter advising you have been transferred to Northern Rock PLC then you are in, what the press are affectionately calling, the “Good Bank”.

NRPLC has a banking license and hence when your existing mortgage deal finishes you will be able to switch to other mortgage products offered by them or of course switch to a new lender.

You may be transferred to the “bad bank” – Northern Rock Asset Management (NRAM). This bank does not have a banking license and hence when your existing deal finishes you will be moved to the variable rate of NRAM at the time. There will be no other products offered to you by NRAM. You can of course switch to a new lender. You can be certain that if your mortgage is one of the “together” products you will be transferred to NRAM.

Many borrowers with mortgages in NRAM will be in negative equity but may well find that when the deal finishes the actual cost of the mortgage falls, as the variable rate is currently low. We recommend you give serious consideration to maintaining your payments to reduce the loan quicker and get yourselves back in the black!

The best thing to do is contact Moffatt Financial Planning for advice on this matter.  Don’t forget we have access to all mortgage products on the market and we don’t charge broker fees.