Quick answer.was quoted a fee of €3126.27
I was quoted a fee of €3126.27.
And you thought AIB were bad?!!Can I ask where on your correspondence from UB that figure was quoted?
I got a letter from them today after requesting the break fee on Friday.
There is no break fee quoted though just what my choice of new rates are.
So I’m wondering if my break fee is therefore zero as Red suggested in the other thread about internal switches with UB.
I’ve attached a snipped version of the letter I got today.
Hi @Twinkletoes078
I realise you're a new poster, so apologies if I haven't explained the below clearly.
It should be worth your while breaking even if not overpaying.
Your break fee would work out as about 0.2% per year for the remaining term. They've just reduced the rate by 0.3%, so if you refix you're immediately saving 0.1% per year.
Give the bank a shout and ask what the break fee is. You might need the cash up front for this (it'll be just less than 1% of your balance in your case if my calculations are right).
Now, if you shorten the term, you'll be contractually tied to that. If money is tighter than you thought, you won't be able to extend the term back out again. But it puts a discipline into it.
If you don't want to shorten the term contractually, then make regular overpayments when you can. They will calculate a break fee (if applicable) only on the amount of the overpayment. If you fix at the new rates for 5 years with AIB, they can only charge you a break fee if they further reduce their fixed rates (this is unique to AIB because of a clause in their T&C's).
Hi red onion. I was thinking ,when I can switch, of getting a split mortgage of 40000 fixed and 35000 variable. Does this sound like a good idea Vs just fixing and making overpayments with a small penalty? I know you've said even overpaying beyond the 10% us still worth it.Im with ulstee at 2.3. Split would be 2.4(ithink) fixed and 3.1% variable if I stayedHi @Twinkletoes078
I realise you're a new poster, so apologies if I haven't explained the below clearly.
It should be worth your while breaking even if not overpaying.
Your break fee would work out as about 0.2% per year for the remaining term. They've just reduced the rate by 0.3%, so if you refix you're immediately saving 0.1% per year.
Give the bank a shout and ask what the break fee is. You might need the cash up front for this (it'll be just less than 1% of your balance in your case if my calculations are right).
Now, if you shorten the term, you'll be contractually tied to that. If money is tighter than you thought, you won't be able to extend the term back out again. But it puts a discipline into it.
If you don't want to shorten the term contractually, then make regular overpayments when you can. They will calculate a break fee (if applicable) only on the amount of the overpayment. If you fix at the new rates for 5 years with AIB, they can only charge you a break fee if they further reduce their fixed rates (this is unique to AIB because of a clause in their T&C's).
We use cookies and similar technologies for the following purposes:
Do you accept cookies and these technologies?
We use cookies and similar technologies for the following purposes:
Do you accept cookies and these technologies?