Hi,
We are first time buyers and currently in the process of buying a home, details of which are:
Price: 325,000
Mortgage Required: 260,000 (80% LTV)
We have approval in principle from both EBS and Bank of Ireland and are awaiting to hear back from KBC. It looked like BOI was the best option due to their 1% cash back offer however I have been wary that there must be some catch...I was thinking of fixing for 2 years and availing of the offer (receiving €2,600 back) and then could switch to the more competitive rate of EBS or another lender.
I have now read that if you change lender within 5 years (60 months) you have to pay back the 1%...so doing the sums on the current variable rates it would appear that the deal isnt as good as it first appears...
KBC (3.89%) : 1224 X 60 = 73,440
EBS (4%) : 1241 X 60 = 74,460
BOI (4.2%) : 1271 X 60 = 76,260 – 2,600 (cash back offer) = 73,660
Obviously this is assuming rates stay the same but based on the above we would actually be €220 worse off with the deal!
Is it the case that the deal is simply a gimmick to get you on board and would we better off going after the lower rates of the other lenders?
Thanks,
David