Switch mortgage to credit union???

D

desparate

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We have €85000 (between 1 big, 2 smaller mortgages) and 6.5yrs left on our mortgages. They are fixed until Aug 2017 ( waiting to hear what penalty would be). Credit union have an offer of 2.99% for people with less than,€100000 and 10yrs, remaining on their mortgages. They would pay for house valuation and we incur switcher costs. Would this be worth doing????
 
Which Credit Union is that? Do they require you to maintain any shares in the Credit Union while you have a mortgage?

We can't tell until you know what the current interest rate is and what rate you will be on when your fixed rate finishes. For example, are you entitled to a tracker?
 
It is with ASTICU. Not sure if we have to maintain shares. Current interest rate is 5.4% with BOI. Not entitled to tracker as far as I know. Our solicitor fees would be €1000. BOI dragging there heels in giving us penalty costs to break out of fixed....tried to get an answer this week but have still heard nothing.
Regards
 
Is that a fixed rate of 2.99% and have you compared what the monthly repayments will be? Obviously the breakage fee will have a big impact on your decision.
 
If you are not entitled to a tracker
If there is no break fee
2.99% is probably good value.

But there probably is a break fee, so you would need to tell us what it is.

Brendan
 
Our break fee with BOI is €1000 and the balance left with BOI is €86148. Credit union comes in at €1214 a month for 6.5yrs. Our repaymayments with BOI are €1270 so not worth changing really. Our trs is €9 a month. Also 2.99 is not fixed but the rate over 10urs we have been told will not go above that but may come down. Thanks
 
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I dont understand, you are saying the only differance between a rate of 5.4% and 2.99% is €56 ? That doesn't sound right although it probably is around 1k per annum. You would save about 4.5k over the lifetime of the mortgage assuming BOI would not give you a better deal when you break out. You're probably as well waiting till the end of the fixed rate to decide what route to take.
 
It doesn't sound right, are those repayments quoted for identical remaining terms and amounts?
 
87148 @ 2.99% over 6.5 years is €1,151 per month

86148 @ 3.9% over 6.5 years is €1252

But in the first 18 months alone, €85,000 @ 5.4% is €6,900

86,148 @ 2.99% is €3,863

So you should save the €1,000 break fee within the first year.
 
Yes quote is for identical terms and amounts...we have been told it's due to short term left but I don't understand it.
 
Is the credit union calculating the repayments on a decreasing balance? Surely they aren't calculating them based on the balance outstanding on 1st Jan or something, is any financial institution still calculating on an annual rest basis?
 
The CU figures are correct.

The BoI ones appear to be incorrect. But we don't know what rate they are using.

Brendan
 
Brendan, BOI say our rate with them is 5.29 fixed until Aug 2017 (5yr fixed). What do u see wrong with BOI rate? Like a lot of people I don't really understand the ins and outs of our mortgage. We would both like to switch to move away from BOI.
 
Desparate
Looking at the numbers given your BOI mortgage seems to have 6 yrs and 8 months left on it ( given the figures above ). since the CU term is 2 months less, this accounts for the minimum difference in the repayment figure
With BOI you will be paying 1270 for 80 months
With CU you will be paying 1217 for 78 months ( the CU repayment over 80 months would be €1,189.08)
 
When the BOI fixed term is up you can move to one of their cheaper fixed rates, current 5 year fixed rates is 3.45%, so it may not pay off to switch because of the size of the legal costs
 
If you use the same solicitor as did the original loan you ought to get a better deal. All the legwork is basically done on the title for that solicitor.

You may be able to negotiate with BofI to switch to variable without a penalty if you threaten to move to the CU. They can waive the penalty if they want.

You need to get the penalty figure in writing. This may trigger them offering you a no switch cost, they tend to act when people are real (ie writing not talking to someone on the telephone)

I'm glad to see the CU is stepping into the market and providing competition to banks.

Odd there is 3 mortgages on the one property.

What is ASTICU (is that linked to the teachers union - just wondering)
 
desparate said:
Our break fee with BOI is €1000 and the balance left with BOI is €86148. Credit union comes in at €1214 a month for 6.5yrs. Our repaymayments with BOI are €1270 so not worth changing really. Our trs is €9 a month.

Also 2.99 is not fixed but the rate over 10urs we have been told will not go above that but may come down. Thanks
Click to expand...

Told = speaks for itself, you need this in writing.

1214 X 78 months = 94692
1270 X 78 months = 99060
Difference 4368

BUT according to poster Blinder you pay BofI two months more so 1270 X 2 = 2540

Add that to the difference of 4368 and your saving is 6908.

What is the current best rate at BofI for variable customers (I presume they have better rates depending on loan to value)
 
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