breaking out a fixed rate mortgage

Apollo

Frequent Poster
Messages
121
hi..I bought a house 6 months ago for 280k. Mortgage, 92%, was 256400 based on a 3 yr fixed of 5.25%. I would like to take advantage of the lower interest rates that are now out there but am fearful of what the breakage fee would be. It looks like I could get a rate for 3.85% variable on the open market today. Does anyone know what the potential breakout fee could be?
 
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irishlinks

Guest
It is likely that your house value ahs decreased - so the LTV will now be more than 92%. It will be hard to find anyone lending over 92% of the value of the house. Your current lender may let you swap over to their variable rate though. Did you find out what the penalty would be yet?
 

Deisce

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Messages
114
I'm in same boat. Fixed my mortgage 21 Jun 07 for 3 years at 5.05%. I borrowed 345,000 in 2006 for 35 years. Due to family bereavement I have a lump sum I want to use to pay off some of the mortgage. I will call Permenant TSB to see how much it will cost to change to variable and what variable is.
 

Deisce

Frequent Poster
Messages
114
I'm in same boat. Fixed my mortgage 21 Jun 07 for 3 years at 5.05%. I borrowed 345,000 in 2006 for 35 years. Due to family bereavement I have a lump sum I want to use to pay off some of the mortgage. I will call Permenant TSB to see how much it will cost to change to variable and what variable is.
No penalty. Rate quoted was less than fixed rate for Jan 2009 (~4.65%). the no penalty makes me suspicious though. Anyone have any comments?
 

Hasslehoff

Frequent Poster
Messages
107
I have a First Active mortgage , fixed at 5.25 ( amount left is €420,000) with three and a half years left to go and they want €11.5 k (as of last week) to let us out of the fixed term agreement. Can anyone advise on this ?
 

ClubMan

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Messages
43,858
Try haggling? But they presumably have every right under the terms & conditions of the loan agreement to insist. So then it's a case of weighing up the costs if breaking out versus the possible savings achievable by switching to another (variable or tracker) rate. Try Karl Jeacle's mortgage calculator to estimate these.
 

giblet

Registered User
Messages
23
Hi Hasselhoff

I have 2 fixed rate mortgage with First Active at 5% , I contacted them to find out what penalty I would have to pay to exit redeem both mortgages. They immediately quoted me 6 months interest for a redemption penalty which equates to 12000€ in total. Based on advice I received here I then asked her to forward to me my contract details highlighting where exactly it states that I must pay 6 months penalty. 3 days later I received an update from the bank stating that they "reviewed" the case and waivered the penalty. They also never forwarded me the contract details stating I would have to pay 6 months interest for each mortgage.

Interesting, I wonder is the 6 month thing pulled out of a hat and because I queried the contract they backed off. Perhaps your quote is plucked from the sky too and really is open for negotiation as clubman mentioned

Because of no penalty I have currently asked if I can go back onto the tracker mortgage I was on before fixing, awaiting their response and will post it . Anyone ever moved from fixed back to tracker and stayed with the same bank ??
 
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Mayo Money

Guest
I spoke to someone recently who were in a 10 year fixed at 5.25% with ptsb. they were able to break out of it without penalty as the variable rate they were switching to was higher than the fixed rate.
 

rgfuller

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Messages
403
I have 2 fixed rate mortgage with First Active at 5% , I contacted them to find out what penalty I would have to pay to exit redeem both mortgages. They immediately quoted me 6 months interest for a redemption penalty which equates to 12000€ in total. Based on advice I received here I then asked her to forward to me my contract details highlighting where exactly it states that I must pay 6 months penalty. 3 days later I received an update from the bank stating that they "reviewed" the case and waivered the penalty. They also never forwarded me the contract details stating I would have to pay 6 months interest for each mortgage.

Interesting, I wonder is the 6 month thing pulled out of a hat and because I queried the contract they backed off. Perhaps your quote is plucked from the sky too and really is open for negotiation as clubman mentioned
A few years ago I was on a 5year fix (on a 30yr mortgage) with First Active (this was prior to the UB takeover of them), the terms of the mortgage which I had copies of and read through stated that a payment of 6 months interest was required to break the fixed term. I did the sums (as suggested above) back then and decided the savings on switching weren't worth it at the time.
 

Petal

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Messages
867
Just to add my two cents - I've been onto PTSB regarding breaking the fixed rate (1 year left). I'm fixed at 4.85, they offered me 4.65 varibale rate and no penalties. So I asked them if I wait till fixed rate expires will I go back onto my original tracker and they said yes i will fall onto the tracker available at the time my fixed rate expires. I have to do some calculating, but I'm pretty certain I'll be better off sitting out the year and falling back onto a tracker rather than going on a variable now.
 
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irishlinks

Guest
Just to add my two cents - I've been onto PTSB regarding breaking the fixed rate (1 year left). I'm fixed at 4.85, they offered me 4.65 varibale rate and no penalties. So I asked them if I wait till fixed rate expires will I go back onto my original tracker and they said yes i will fall onto the tracker available at the time my fixed rate expires. I have to do some calculating, but I'm pretty certain I'll be better off sitting out the year and falling back onto a tracker rather than going on a variable now.
Depends how much the PTSB tracker is above the ecb. They don't offer new trackers . Can you find out what tracker rate you would go onto now if your fixed rate ended today?
 

Petal

Frequent Poster
Messages
867
Well, I assumed I would fall back onto the one I had before fixing which was ECB+1.1, but you're right, I should ask!
 

shootingstar

Frequent Poster
Messages
634
Very interesting thread. I`m with UB. fixed rate for 5 years back in aug 07. Will def give them a call today to see whats what. Im fixed at 4.95%
 
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foxy21

Guest
I am in a 2 year fixed with PTSB until Nov 09 @ 5.2%. Just called them and they advised there will be no penalty to change to an LTV variable. They stalled this for 20 days which means if I send letter to change terms within 20 days there will be no penalty. If I do so after 20 days it may be subject to penalty and I have to ask again to confirm. btw LTV variable is 4.65%
 
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foo

Guest
Just rang ebs today to see about breaking fixed motgage. Fixed at 4.75 and only 1 year left ( Fixed for 3 ). Would cost 9000! I nearly fainted especially since I knew that ptsb are not charging. Variable rate would be 4.18 so don't think worth it.
 

bmm

Frequent Poster
Messages
46
Yes the EBS have turned out to be the worst crowd to deal with. Considering the bailout they are getting from Irish Taxpayers and also considering the society is supposedly owned by it's members. They are by far the least forgiving of all the Irish mortgage lenders. EBS= "Exceptionally Brutal Service"

I have 144k loan with them fixed for another 3 years at 4.88% . They are looking for 6.6k breakout fee.

This is the Topup portion of this investment mortgage so if house prices get any worse they'll be getting the keys to the property and they can go and stuff the breakout fee along with the other couple of hundred thousand onto the toxic asset sheet!
 

fcdub

Registered User
Messages
20
I think this was asked before but not answered.

Is anyone suspicious as why ptsb and some of the other banks are letting us out of our fixed mortgages?

Whats the logic for them?

Is it possible that they plan to increase their variable rates and not pass on decreases in the ECB?

I really dont know whats in it for them. I have 2.5 years left on my fixed mortgage at 4.9% and they are letting me out free. why????
 
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irishlinks

Guest
I think this was asked before but not answered.

Is anyone suspicious as why ptsb and some of the other banks are letting us out of our fixed mortgages?

Whats the logic for them?

Is it possible that they plan to increase their variable rates and not pass on decreases in the ECB?

I really dont know whats in it for them. I have 2.5 years left on my fixed mortgage at 4.9% and they are letting me out free. why????
Mybe it's because the PTSB variable rate is no lower than the fixed rate you are on - so they don't mind you breaking the fix. Other lenders variable rates are lower - so people coming off a fixed rate will cost them more.
 
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