No response from bank re overpaying

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brokeagain

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I am trying to overpay my mortgage to reduce the length of it from 30 to 20 years and reduce the interest by 65k over term of it. I have rang the bank on four occasions and each time I was informed that someone would call me back but no call yet. I also went into the bank and requested the overpayment and again I was told that they would get someone to call me...still no call. I also send a letter to the head office in Dublin and still no reply.

Can anyone tell me what I need to do...stop paying..maybe they will give me some attention then!!!!

It's AIB btw.
 
Have you tried email? I deal with our mortgage advisor (B of I) by email and it works perfectly well. We overpay also and each year I vary the overpayment and it is handled immediately.
 
I would continue overpaying at a rate that you think would clear the mortgage over 20 years instead of 30 years. There is no need for a formal agreement as the interest is charged on the outstanding balance. You will also have the flexibility of just repaying what would be the normal repayment if you ever had a cash flow problem without getting a bad cr rating.

I have done this in the past with an Aib mortgage. I would have lodged a lump sum like €500 to €1000 on an off and this reduced my monthly mortgage repayments and I reached a stage where I was able to clear the mortgage early. At the time they referred to them as out of course payments.
In this scenario you have the flexibility of a 30 year repayment period while you pay interest only on the outstanding balance.
You have a more flexible cash flow situation.
You can decide when you make the "out of course payments".
There are no penalties for the "out of course payments" unless you have a fixed rate mortgage.
You can still pay it off in 20 years or less or continue for the 30 years.
Personally I would not bother with getting it formalised.
 
Thanks for your replies emeralds and Dermot. Emeralds you have the email address?

So Dermot, can I just transfer the amount online to mortgage account or how do I make the payments?
 
To Live;

Pay any surplus amount you want to into your mortgage account in whatever way suits YOU.. be that online/DD/Standing Order/cash etc.
It will have the nett effect of reducing both term and interest and you will auomatically get both the interest benefit and term benefit.
 
Gerry Canning said:
Pay any surplus amount you want to into your mortgage account in whatever way suits YOU.. be that online/DD/Standing Order/cash etc.
Click to expand...

You would think that would be straightforward enough alright but I just checked my AIB online account and it doesn't allow transfers from my current a/c into my mortgage account.

Could the a/c number and sort code of the mortgage be used to transfer from a different bank?
Would this definitely be offset against the capital - if so then a Standing Order could be set up.

I have made an overpayment previously and I had to go to the branch and fill out a form stating that I wanted the overpayment to decrease the capital and not the payments.
 
DoctorEvil said:
Could the a/c number and sort code of the mortgage be used to transfer from a different bank?
Would this definitely be offset against the capital - if so then a Standing Order could be set up.
Click to expand...

Yes, you can transfer ad hoc from other Bank accounts using account number and sort code. And it definitely goes off capital immediately.
 
Interesting. We are slightly overpaying an Ebs mortgage on a fixed rate by agreement but I like the flexibility of this for when we come off the rate soon. Where do you find the sort code and account number of the mortgage? Is it just set up as a payee on online banking then?
 
Yes, I just set them up as a normal payee and make ad hoc payments.
Every so often I contact them (if not rate change caused) and ask them to recalculate monthly payment or term.
 
Thanks for all your advice. Just an update, I finally received a letter from AIB yest advising that they had reduced the term of the mortgage and that teh payments would be increased as requested. I would love to get a breakdown of the new term, ie. how much interest would be paid now. They didn't provide any calculations. I guess I'll have to email them.

Thanks agian for all your help.
 
I have done this in the past. I spoke to the home loans dept in Dublin and sent them in a scanned letter by email to [email protected] saying

Please increase monthly mortgage repayments on this account to €xxxx per month. We wish to use any excess over required mortgage payment to reduce the term of the loan.

Please confirm the expected expiry date of this loan.

You have to tell them that you want to reduce the term of the loan, not maintain the current length of mortgage and reduce the interest paid.

They send out a letter in about 10 days confirming the new repayment and the new finishing date of the mortgage, not exactly what you say to them because they want to finish the final month of the mortgage as a full repayment but within a few euro.

I found an Karl Jeacle's Mortgage Calculator online very helpful (I think it was originally recommended by someone on these forums).
 
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