LTV 75% and provider choice

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cuppatea

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Hi everyone,

I'm looking for some advice re provider mortgage rates for a 75% LTV. We're hoping to start overpaying from month 1 so fixed route isn't really an option. BoI for example only allow you to overpay by 65euro a month when on a fixed rate.

So the options are far as I can tell are KBC, BoI and AIB.
KBC are offering the .2% reduction if you have a current account which would mean a rate of 3.45%. Thing is though, I'm currently with KBC and my rate is the standard 4.5% so I'm wondering just how long does that 3.45% last and you're moved from a new customer rate to an existing customer one? It's hard to find out that information and even the KBC mortgage team can't seem to give a clear answer. What have other people's experiences been with starting a mortgage on the 3.65%(or 3.45% with current account). How long has the low rate lasted?

The svr rate for BoI is 4.2% which is on the high side comparatively speaking but granted you do get 2% back but are locked in for 5 years. Some others on the forum have had customer service "issues" with BoI too so that's not overly appealing to be honest, who needs that hassle?

The AIB rate is an interesting one, I've never considered AIB as a viable option given that they're constantly in the news for overcharging customers and have suffered gross mismanagement. Still, they can offer a rate of 3.55% and from what I've seen that's not an introductory rate. I'm going to give them a call and arrange a meeting with them tomorrow to see exactly what the story is. Again, has anyone had experience opening up a mortgage with them at this low rate?

Cheers!!
 
I would suggest that you should also look at Ulster Bank and EBS.

If you are borrowing more than €250k and are happy to open a current account with Ulster Bank, they offer the best variable rate at your LTV of 3.4%. They will also give you €1,500 in cash.

If you are borrowing less than €250k, then EBS have the best variable rate at your LTV of 3.5%.
 
Thanks Sarenco, I had just noticed the Ulster Bank rate so will be looking to talk to them too. It's going to be a €180k mortgage so won't make that low rate of 3.4% but that's a good one, especially with the 1500 towards legal fees. The rate with that amount from UB would be 3.7% which still isn't too bad at all.

I see from the EBS website that they have existing rates so they mustn't be too generous in passing along interest rate changes ... well, the downwards ones anyway!
 
For completeness, I should have added that PTSB offer a discounted variable rate of 3.4% at your LTV for one year plus a €1,000 cash back offer if you fulfill certain criteria.

After the first year, the rate is scheduled to rise by 0.5% so it's really only a good option if you plan on paying off the mortgage in very short order.
 
No, EBS are part of the AIB group these days and have the same pricing policy as AIB in terms of passing on cuts to existing borrowers. Of course this might all change in the future, particularly if the Government sell AIB.

Ulster Bank's cash back offer is certainly attractive but, if I was in your position, I would go with the lowest variable rate every time.

It's well worth while taking the time to talk to a few banks (I know it's a hassle) in any event. Rates may well change before you draw down your loan and then you can choose whichever bank is offering the best rate in your circumstances at that time.
 
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Lovely stuff, thank you for the info.

That's a steep increase after a year from PTSB and they don't exactly have the best track record with rates either. Didn't they have rates like 6.25% back in 2012 when the average was 3% but no one was lending apart from them?

I'll definitely take your advice and take the time to speak to the lenders.
 
Yeah, the PTSB offer is a bit gimmicky really but it might make sense in some limited cases (for example if somebody is waiting for a large distribution on an inheritance).

With a relatively low LTV you should hopefully always be in a position to switch providers at a later stage if that makes sense so you should really just concentrate on getting the best deal that is available today in my opinion.
 
So we've been around talking to BoI, AIB and Ulster Bank so far and the best deal we have come across at this point is from Ulster Bank.

Their discounted variable rate is 3.7% which is 0.15% more than AIB and 0.5 more than EBS but you do get 1500 cover for legal fees and they cover price of valuation which is around 150. Same deal for switchers. That's not the bit which grabbed our attention though; that's the fixed rates of 3.55% for 3 years, 3.6% for 5 years and 3.7% for 7 years. Those rates are low and compatible with lowest variable rates today. They seem a good enough deal over the longer term. On top of those low rates is complete flexibility to overpay by any amount if doing so with regular monthly payments. Other lenders don't allow that at all or only allow a paltry amount (BoI is 65 euro a month for example).

If anyone is looking to move up, fix or switch then UB are worth talking to
 
- I am in the similar situation as you are.

Borrowing less than €250K hence can't avail the best rate offered by UB. PTSB and BOI rates are much higher than the rest so they are crossed off the list too.

AIB seems like the best option to me as;

1) They offer the lowest variable rate (3.55%)
2) I can see from the Sarenco's response that AIB do pass on the benefit of future rate cuts (though it can change in future).

Yes, KBC rate (3.45%) is lower than AIB but you will have to open current a/c with them and they don't tick the above point (2).

Two questions if you guys know the answers;
If I want to pay lump sum of the capital, will I be allowed to do so with AIB ?
Once my LTV will go below 50%, will the lower rate of 3.35% will kick in ?


if answer to either of the questions is No, will i able to do the same with EBS ? EBS rate is lower by .05% than AIB, monthly repayment goes down by €6 per month. I currently bank with AIB, they are close to my work but I can go to EBS if they are more flexible than AIB.

 
You are entitled to pay down any variable mortgage ahead of schedule without penalty.

As far as I know, your LTV at drawdown determines your LTV bracket for the duration of your loan and AIB (in contrast to Ulster Bank) do not allow borrowers to move to another LTV bracket during the loan term. However, I would double check with AIB that this remains the case.

EBS are in the same group as AIB and I assume they apply the same policy regarding moving between LTV brackets. But, again, it's worth a call to confirm the position.

I certainly take the point that the difference between the AIB and EBS rates is minimal but if that small difference was maintained on a €200k loan over 25 years, it would add up to a difference of €1,561 in the total cost of credit.
 
I spoke with AIB yesterday.

1 - As mentioned above, AIB has been passing on the benefit of lower interest rates to the existing customers for the past couple of years.
2 - When my LTV will drop below 50%, they will NOT offer the lower rate. Your LTV value is determined at the time of drawdown only. However there has been cases when customer put the request to get lower interest rates when their LTV went down 50% and their requests were accepted - but its not "guaranteed".

What the lady in the AIB suggested that if you hoping to pay lump sum in two years time to bring the LTV below 50% then get fixed rate for 1st two years, LTV will be determined when fixed rate will change to variable and I'll get the lower int rate.

I'm sure you guys knew this already but just thought to share my findings for new members like myself.
 
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