After 1,127 days, enough is enough

That’s what the cards say this morning. Over a thousand days ago, so in the middle of February 2009, I made a big fat non-decision regarding a very large sum of money (to me).

The large sum came my way a few months prior. After talking with a financial advisor (yes, I actually went to see one because I didn’t know what to do about my expiring mortgage deal), I decided to take some of the equity out of my flat so that I would have a deposit to buy someplace else. A place I actually wanted to live in.

But about two weeks after I signed a new mortgage deal and this chunk of equity hit my bank account, the entire global economy collapsed.

I had been incredibly lucky, I’d signed what would turn out to be an unbelievable mortgage deal (a lifetime tracker*) and received a stack of cash literally days before no bank planning to stay in business would have agreed to either.

But because the economy did collapse, I could no longer use this sum as I’d intended. Like millions of other people, I wasn’t about to be offered a mortgage on a new property by any bank for a long, long time.

Since I’ve never had so much money all at once (roughly equal to half my salary), I was too scared to touch it; so I just left it there. Sitting in my current account.

About five months later, in February 2009, my bank called me to ask if I was actually insane. That no one should leave this amount of cash sitting in a current account where a) it could be stolen if someone had access to my card and b) it was making virtually zero interest. And so I agreed that they should set up a new account, a savings account, one where the money would earn a little interest and be safer.

And then I went straight back to being too scared to touch the money.

That was over a thousand days ago and this week’s card, the mighty King of Hearts insists that I stop being such a loser about this and find a better place to put what may be a large sum to me, but is still not large enough to be much use in terms of buying a new place to live.

I’m already feeling like I need way more than a week to work this one out — where is the best place to put this money? But in fact all I really have to do is compare saving options. Once I do, it may become more obvious … hopefully.

* * *

* Repayments on tracker mortgages “track” to the rates from the Bank of England’s base interest rate. Which means repayments aren’t fixed, but vary and which has also meant since the collapse of interest rates that the repayments can be and in my case are, extremely low. Over the course of early 2009 what I had to pay monthly on my mortgage went from almost £2,000 to just under £200. While I haven’t seen much press on it in the UK, in Ireland the banks went crazy trying to back buy tracker mortgages from customers since in the current times trackers favour us, not them.

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One thought on “After 1,127 days, enough is enough

  1. RIGHT — SO THIS IS REPLY FROM MY FRIEND F WHO POSTED THIS TO FACEBOOK AFTER DIFFICULTY LEAVING A COMMENT ON THE SITE (SORRY)
    THANK YOU FOR SENDING THIS IN!!! XXXX

    You’re right in one way about the Irish banks. They are keen to get Tracker mortgages off their books but they are not scrambling to do so. We went to them seeking a mutually beneficial arrangement and were declined on the basis that our credit rating was too good. However, if we were in arrears and likely to default, then the boardroom was ready for some chit chat. There is evidence to suggest that they are now being more proactive and approaching some customers but only offering a 10% discount off their mortgage in return for switching them to a variable. In reality, the discount should be closer to 40% or 50% depending on the size and term of the mortgage but that ain’t going to happen.
    Finally, in relation to where to invest. As you know, we are in Nice at the moment. We have just had the most incredible day. We bumped into the owners of a local cafe. One we have been to with you before. Anyhow….they brought us up to their apartment which is being renovated. It is AMAZING!!!! 2000 sqft. Overlook the sea in a stunning building on Rue de France. Anyway, they bought it by way of ‘vie âgée’ which is where you agree to make a lump sum payment for a property (say 10 or 20% of its value- these are just ballparks) and pay a monthly income to the elderly owner of say €900 a month. You then sit tight and God bless us all but you hope they meet their end soon. Anyway, you place your bets and face the odds. These guys were very lucky and were only waiting 3 years. They are now the proud owners of an apartment in one of the best buildings in Nice. all for about €400,000. It’s worth about €1,500,000.
    Word of warning! The oldest woman in the World is French. She is 120. She has out-lived 3 people whom have ‘bought/bet’ on her demise. Now she is smiling (toothlessly) all the way to the bank. Food for thought.

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