gnf_ireland
Registered User
- Messages
- 1,441
Looking at those rates - I wonder would the 5 year fixed at 3% be attractive to some people, especially those looking for repayment stability !
Looking at those rates - I wonder would the 5 year fixed at 3% be attractive to some people, especially those looking for repayment stability !
So should you fix for one year at 2.9% for LTV <90% compared to a variable rate of 3.5%.
This is a hard one. Personally I think you should try to switch to EBS and collect 2% in the process.
Who knows where interest rates will be 5 years from now?
Would EBS refi a loan with an LTV over 80%?
No one. But it is likely that Irish variable and fixed rates will fall in the next year or two. When fixed rates are down to fair levels, it might then be advisable to fix.
But it is likely that Irish variable and fixed rates will fall in the next year or two.
I don't know, but I think that they should. They all want to lend 90% LTVs and switches are not subject to Central Bank restrictions.
I have a question though what rate do you go on after the 1 period is up. is it current variable rate or present rate now?
I have a question though what rate do you go on after the 1 period is up. is it current variable rate or present rate now?
I wouldn't share your confidence that it is likely that rates will fall far enough and quickly enough to justify your position.
EBS's variable rate is 3.7% at that LTV and switching costs will eat a large element of the 2% cash back incentive for an average loan balance.
Is that more attractive than a 1-year fix at 2.9%?
Re EBS, do they pass on any rate reductions to existing customers?
Excellent question. And this is one of the reasons I just don't like fixed rates. They often have implications which one doesn't think of. This is what KBC says on their website. I presume that they have changed their policies as a result of yesterday's announcement, but I just would not trust them unless it is spelled out clearly on their website and in a personalised letter or contract.
A similar customer above could also increase their savings in year 1 to €174.01 per month and €25,261 over the term by availing of the 1 year fixed rate of 2.90% (rolling to 3.50% on conclusion of fixed term)."
If I switch to EBS,
Interest: €200k @3.5% = €7,000 (If I fix for a year)
Add legal fees: €1,000
Less cash back: (€4,000)
Total cost: €4,000
So that would be, just about, worthwhile. But you would have to switch again after a year, and lenders may no longer be offering switching incentives.
That would be clear enough for me, and more importantly for the FSO.
Would a difference of .4% out weigh a cash back of approx 5,000 after switching fees?
Generally, in any sort of financial planning, flexibility is very valuable. Tying yourself to a particular lender and deal for three years just seems wrong, unless that deal is inherently good value, which in this case it certainly is not.