ECB Rate Lower - Worth taking a Loan out?

D

djsim

Registered User
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Hey Guys,

With ECB Rates going down further in the next couple of weeks, I was wondering if anyboby thought about borrowing a lump sum, lets say from a credit union and paying some off the mortgage?

I have a tracker mortgage with NIB (.75% above ECB Rate). If the ECB rates hit, lets say 2.5%, would it be worth my while to borrow from a credit union\bank and pay a lump sum of my mortgage. I was thinking in the region of 20K?

Let me know what you guys think?

Thanks,
James.
 
You're unlikely to be able to get a loan for a lower rate of interest than your mortgage. So it wouldn't make sense to me to borrow to pay off a portion of the mortgage.

Sprite
 

Not really since in reality you are taking on more expensive debt to pay off cheaper debt. Would only make since if you can borrow at cheaper than your mortgage and it is unlikely that you will be able to get a unsecured loan at less than ECB +75bps
 
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keep your mortgage repayments the same and you'll knock years off your mortgage and save thousands in interest
 
That is great, thanks for all the replies.

My thoughts were, yes, the loan would be for a higher rate, (but shorter term) but I would save €1000's in interest over the term of the mortgage if I paid of a lump sum.

Just my thought, I was wrong.

Thanks for your help,
James.
 
djsim said:
That is great, thanks for all the replies.

My thoughts were, yes, the loan would be for a higher rate, (but shorter term) but I would save €1000's in interest over the term of the mortgage if I paid of a lump sum.
Click to expand...

if you put an extra 400€ a month off your mortgage you'll save more time and money then getting a more expensive short term loan horse...
 
If you can easily afford the current repayments then as the previous poster advises, keep to these repayments.
Contact NIB and tell them you want to keep your repayments as they are currently with any overpayments to be taken off the capital sum.
 
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