Switching from BoI 4.05% SVR to KBC 3.65%?

Subotai

Registered User
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This offer from KBC has intrigued me. My mortgage is currently with BOI, and is a SVR of 4.05%. We have a house in Dublin with about €281,000 left to pay on the mortgage, and the house is worth about €480,000 now with the recent price rises in Dublin. This gives us a LTV of 58%.



I rang KBC today, and they offered me a switcher mortgage with a rate of 3.65%, if I switched my current account to them. This would result in my monthly mortgage payments dropping from €1436 to €1337, almost €100 a month less. I would have to pay current account fee, but this is only €6 a quarter. They pay €1000 towards the legal fees, and throw in 1 year free house insurance.


With a saving of €100 a month, it would seem like a no brainer to switch to KBC, but I am wondering down the road would they hike rates? Like Danske did? What do people think? I suppose we could switch to them, and then switch again to someone else if they hike the rates?
 
A couple of points.

1) Are you sure you are being charged 4.05% by Bank of Ireland? I have the SVR for existing customers as 4.35%.

2) It is incorrect to compare the repayments. The repayments include a capital element. You should compare the interest charged and only the interest charged.

So the amount saved this year will be
Mortgage amount|€281,000 |
Difference in rates|0.4% |4.05% - 3.65%
Amount saved|€1,124

It will be roughly this amount for the first few years but will gradually reduce as you pay down the capital.
 
Hi Brendan, yes, the 4.05% rate with BOI is correct. Their SVR for new customers at the moment is higher than those for some existing customers. This is because they didn’t pass their penultimate SVR rate increase in 2012 onto existing customers.
My only concern about switching to KBC is that after I go to the hassle of it, pay the legal fees, etc., they turn around and hike their rates.
 
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