Any reason not to switch to BOI Fixed rate in the short term

A

AlbacoreA

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I see BOI now have 2Year Fixed LTV <=60% 3.35% or 3.4 for 1yr

Any reason not to switch to this for SVR customer of any Irish bank.
 
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Lots of reasons

1) Generally BoI exploits its existing customers, so that is a good reason to avoid them
2) When Frank gets up and going, borrowers with LTVs of less than 60% will probably be paying around 2.8% So why pay 3.35% when you can probably be paying less?
3) Rates may fall further if Frank prompts a response from the other lenders or if the new government takes action on mortgage rates.
4) What happens at the end of year 1? You have no idea what they will be charging. You will be stuck with them as you will have to give back the 2% cash back, if you switch to another lender.
5) What happens at the end of year 5? Again, it's likely that they will still be the most expensive for existing customers.

I am really at a loss as to why anyone would consider switching to Bank of Ireland.

Many customers think that they will switch after the 5 years. Don't rely on it.
Most won't bother and many will not be able to switch.
 
I think I'm missing something. Why can you not switch at the end of the 1 or 2yr. If you only fix for that long.
 
OK, you probably can switch. But you would have to give back the 2% cash back.

But if you want to go to all that trouble, why don't you take out a KBC "variable" rate of 3.2%?

Or if the mortgage is >€250k and Ulster Bank mortgage at 3.2%? Which may well be lower after a year.

But don't forget : Most people don't actually switch. And many can't.

Brendan
 
I was simply thinking of what's the cheapest now, in the short term. If we are to believe that rates will fall within next 2yrs. I not wholly convinced of this yet. But you'd want to be in a position to take advantage if that was to happen. Looking at Ulster Bank the shortest seems to be a 3.25% for 3yrs. Which is only 1% less but locked in for another 1~2yrs. KBC seems to be 3.45%. I agree in principle of your stance about not rewarding those that do not pass drops in the rate onwards. But as a holding pattern until it becomes a bit clearer what's going to happen is BOI not an option then?

Perhaps for many, BOI just isn't an option regardless of rate.
 
But why would you fix with BoI at a higher rate, when you can get a variable at a lower rate which will allow you to take advantage of cuts if they do happen?

The only reason I can think of is that you feel that interest rates are going to rise within the year.

Brendan
 
Frank will rock the mortgage market in a matter of weeks, not months. In my view, variable rates will be around 2.8% before the summer. And interest rates generally will be low for a long long time. They have to be. Fixing at the 3.35% level would be a terrible idea.
 
Certainly no harm in waiting a few weeks if not a few months and see how it plays out. Thanks for the replies.
 
Brendan Burgess said:
The only reason I can think of is that you feel that interest rates are going to rise within the year.
Click to expand...

Another reason might be that a borrower has a particularly compelling reason for availing of BOI's 2% cash back offer. Paying down expensive credit card debt or funding a promising business opportunity, for example.

Otherwise, I would be very surprised if the best variable rates available on the market do not drop below 3% at some stage this year - at least for low LTI/DTI borrowers of non-jumbo mortgages with LTVs of less than 60% and terms of less than 20 years.
 
Gordon Gekko said:
Frank will rock the mortgage market in a matter of weeks, not months. In my view, variable rates will be around 2.8% before the summer. And interest rates generally will be low for a long long time. They have to be. Fixing at the 3.35% level would be a terrible idea.
Click to expand...

Gordon Gekko have you specific and factual information that leads to this conclusion regarding the starting dates for the big Frank shakedown that will turn things around for Ireland's SVR holders? You sound very sure.
I am an interested BOI SVR holder.
 
Folks,

I have a mortgage with BoI, a one year fixed term @ 3.7% (€2,180 pm) is coming up and they have written to offer a choice of fixed rates as follows for a LTV 61-80%

1 yr @ 3.4% @ 2,106
2yr @ 3.35% @ 2,094
3yr @ 3.45% @ 2,119
5yr @ 3.45% @ 2,119
10yr@ 4.2% @ 2,300

If I return to my variable it is 4.5% @ 2,379. The latter is not an option, is the 5 year fixed a good option ? Is this as good as fixed will get? Your considered views would be welcome.
 
Hi Fiver Spare, can you not fix again after 1yr, if you fix for a year?
I was just about to fix for a year myself with BOI, but I thought I could fix for a year then decide again when that year comes to an end?
 
I hadn't heard of Frank until this thread - their website wouldn't exactly fill me with huge confidence that they're going to be a major player. Who is backing them, who are they?
We're looking at getting a better rate and BOI is tempting with the cash-back but obviously the 5 year hold (through having to pay back if you move) and BOI's record in fleecing current customers is making me wary.
My current 1 year fixed with AIB is up in June so I'm hoping someone else comes in before then.
 
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