First Time Buyers with an Ulster Bank Home Saver account can get an additional €2,000 "cash back".

Brendan Burgess

Brendan Burgess

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Ulster Bank has launched a Home Saver Account

Savings Accounts - Savings | Ulster Bank

Ulster Bank Ireland DAC is no longer accepting any new application requests from personal customers. There are some exceptions to this for existing customers, visit our website for further information.
digital.ulsterbank.ie digital.ulsterbank.ie

If you are a first time buyer and you take out an Ulster Bank First Time Buyer mortgage within 36 months of opening your Home Saver, you may be eligible for €2,000 bonus interest*, eligibility criteria applies.

* Bonus interest is paid net of Deposit Interest Retention Tax (DIRT), once your Ulster Bank Ireland DAC First Time Buyer Mortgage has drawn down


To qualify
1) You must be a First Time Buyer
2) You must save a minimum of €1 a month for 6 months
3) You must have saved a minimum of €10,000 in the account
4) You must draw down the mortgage within 3 years of opening the account


It looks clear that anyone thinking of buying a house in the next few years should open one of these accounts.

When you go to draw down the mortgage, you should make the decision on which bank to go to based on the mortgage deal offered. If it happens that Ulster Bank is the best deal, as it often is, then you get another €2,000.


So open an account and set up a standing order for the maximum of €2,500 a month. After 4 months, you will have reached the minimum balance of €10,000 and can continue to contribute or you can reduce it to €1 a month, if that suits you better.

The interest rate of 0.85% is good.

Brendan
 
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Thanks Brendan.

Looking to avail of this but have hit a snag. We would meet all other criteria bar 2) You must save a minimum of €1 a month for 6 months is the only blocker;

Our situation;
UB loan offer signed. House build completion ETA end of March per developer, April or May per estate agents (i.e. add a month)
Drawdown therefore will be April at earliest, or if there are delays May or even June at latest.
If the Home Saver account is opened this week (applied for) & first regular payment is made before end of Feb then it would give us;
If April drawdown; 3 months payment history
If June drawdown; 5 months payment history.

Can anyone think of a way around this? E.g. do UB offer a facility to postpone drawdown (first monthly payment) by a few months?
 
James5 said:
Can anyone think of a way around this? E.g. do UB offer a facility to postpone drawdown (first monthly payment) by a few months?
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You're mixing up drawdown and first repayment date. Drawdown is the date you get the money.
 
RedOnion said:
You're mixing up drawdown and first repayment date. Drawdown is the date you get the money.
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Thanks RedOnion. True I am. Noob to mortgages.
So as i understand it, basically drawdown is when the lender issues cheques on receipt of the solicitors instructions ie when the client requires the funds. I understand some lenders treat drawdown as being when the cheque is sent out; some treat it as being when the cheque is cashed. Does anyone know how UB categorise drawdown?
 
James5 said:
I understand some lenders treat drawdown as being when the cheque is sent out; some treat it as being when the cheque is cashed. Does anyone know how UB categorise drawdown?
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I'm not sure with Ulster Bank, but a lot of them use electronic transfers now rather than cheque.
 
RedOnion said:
I'm not sure with Ulster Bank, but a lot of them use electronic transfers now rather than cheque.
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Thanks RedOnion, so in short there doesn't seem to be a way around this UB criteria unless there are some extraoadinary delays in the build or paperwork between now & drawdown. I assume that asking our solicitor to delay sending drawdown instructions to UB would generally not be advisable (i.e. it could put us at risk of being in breach of contract with the developer & risk losing the house)? Obviously not going to risk much for the sake of 2k.
 
RedOnion said:
2k less DIRT.

I'd open an account anyhow and start saving. If there's an unforeseen delay you might benefit. Some compensation for your delay!
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* Bonus interest is paid net of Deposit Interest Retention Tax (DIRT)
Net of tax would be after tax is taken away. So this reads like 2k is received & no DIRT is payable on it, no?

Will do.
 
James5 said:
So this reads like 2k is received & no DIRT is payable on it, no?
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I don't believe so. I think it's 2k gross, and they deduct DIRT.
I haven't read the fine print, but I can see how you've interpreted it differently.
 
It seems somewhat counter-intuitive if the purpose of the Home Saver product for UB is to attract new mortgage customers that they'd put this 6 months savings history restriction in place. This is given that loan offers are generally only valid for 6 months (i.e. it would need to be extended/re-applied for by default in order to avail of the bonus interest) & you'd have to have fully decided on going with UB for your mortgage, open the account & start saving into it at least 6 months in advance of drawdown. With interest rates competition heating up & rates changing relatively frequently that's not quite realistic for most FTBs.
 
James5 said:
It seems somewhat counter-intuitive if the purpose of the Home Saver product for UB is to attract new mortgage customers
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I think it makes sense to them. It's a marketing product.

As you say, most people buying in the next few months already know which bank they will use (or at least already have their mortgage applications in). In your case for example, they already have your business - they don't need to offer you an extra incentive, as much as you'd like them to.

UB already have some of the most competitive rates available (which I'm guessing influenced your decision), so this is just a way of them offering some level of cashback to customers where that's a factor.
Once you open the account, it's automatically going to be a factor you consider when applying for a mortgage, so they might pick up some extra market share they wouldn't have otherwise.
 
Ulster Bank give 1500 cash back on mortgages anyway, even if not a first time buyer. So is this just 500 extra?
 
So Brendan, given your expertise in this arena, you believe this is a good offer for anyone thinking of buying a house in the next few years?

Thanks.
 
Yes it was, but I thought there might have been new offers since you posted. Sorry for asking.
 
I'm thinking of buying in the next few years so will open one of these (I was already looking for options as I'm about to max out my KBC Extra Regular Saver. I would most likely be buying with my girlfriend but we haven't combined our finances yet.

Will we be entitled to use the bonus if we go for a joint mortgage but only one of us has this account?

I guess when it comes time for getting the best mortgage we would then have to do a quick calc. to see if Ulster Bank were the best given the "free money" even if they weren't the best rate. UB would basically have a 2k - DIRT head start, correct? Sorry I'm pretty new to this but it sound like it would put them in a good position.
 
I'm looking at buying too with my partner in the next 2 years as a FTB. From the BestBuy post on FTB mortgages, both BOI and Ulster Bank are competitive (who knows how things will change in coming months though!). I see BOI have a similar product to this called the mortgage saver account.

Would it be a reasonable idea for my partner to open a Mortgage Saver account (she is a BOI current account holder) and me to save in this ulster bank home saver account and then see where the mortgage rates are when it comes to getting a mortgage?
 
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