*all rates incorporate 0.20% current account discount available to customers
So take an example (that just so happens to be close to my scenario ). Lets say you're 12 months into a 36 month fixed term at 3% on €400k and now the KBC release a 2.6% 3 year fixed rate offering. Would the break fee be -B = (W - M) x T / 12 x A, where:
B = The Break Funding Fee.
W = The Wholesale Rate Prevailing at the date of the existing fixed rate applying to the loan was set.
M = The Wholesale Rate prevailing at the switching/redemption date for the unexpired time period of the Fixed Rate Period.
T = Period of Time in months to the end of the Fixed Rate Period.
A = Principal amount which is subject to the existing fixed rate and which is being switched or redeemed.
‘Wholesale rate’ means the rate per cent per annum which the Lender determines to be the market rate applying to an appropriate interest rate swap for the relevant time period.
They can ask you to jump about like a monkey as a condition for a rate if they like.To take a fixed rate KBC insist on direct debit payments, I currently pay my mortgage by SO weekly rather than monthly and don't want to change.
Are they within their rights on this?
These new rates won't be available until 3rd September. So I'd suggest you request a break fee towards end of August and decide then. If break fee is less than 3,500 it'll be worthwhile. (It will be less than that).