Mortgage Approval - now UB drop the rate!

D

Dublin6

Registered User
Messages
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Hi

We have just been through a lengthy mortgage approval process with UB for the 3 year fixed rate (which until today was at 4.65%). We were approved, and were awaiting our formal loan offer letter. We have a current mortgage with UB which we are clearing with the sale of our current house.

But today they dropppe the rate! And changed it to 5.34% (a difference in our repayments of 400 euro a month)!

We can't afford this higher rate. I assume that UB are under no obligation to honour the 4.65% rate that we signed up for?

We are under time pressure as we are closing on 24 July. Has anyone else dealt with this? Are we better off starting all over again with the approval process with another lender (next best appears to be Bank of Scotland 2 year fixed at 4.58%). Also consdiering Halifax discounted tracker at 0.35% above the ECB (for first 12 months)...

Thanks for your help,
C
 
Dublin6 said:
But today they dropppe the rate!
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You mean they stopped offering that rate and increased it?
We can't afford this higher rate. I assume that UB are under no obligation to honour the 4.65% rate that we signed up for?
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The terms & conditions of a provisional loan agreement usually allow the lender to revise the rate in certain circumstances. Presumably your dealings straddled the recent ECB rate hike of 0.25% so this and general speculation/outlook on rates will have impacted fixed rates in the meantime?
Also consdiering Halifax discounted tracker at 0.35% above the ECB (for first 12 months)...
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If you are at the limits of your affordability then (a) you might be better off fixing on the best rate available from any lender for your situation and (b) you should probably ignore one year discount rates as they distort things and distract from what you will be paying from year two onwards.
 
I got 4.56% int only from BOSI. 2 yr fixed. the rate increased during the process and we are still getting based on the lower rate.

Are you sure that 4.58 % is not an old rate pre recent increase?
 
The rate that applies is the rate at drawdown, not the rate on the loan offer which may be higher or lower. You could look at taking out your mortgage with another lender - with a closing date of July 24th it is certainly do-able. With the recent ECB increase all lenders will be pushing up their fixed rates bu maybe not by as much as UB's .5%.
 
Sorry I just read the OP again - are you sure that the rate jumped by that much, could you be mixing up the rate and the APR? I don't have the old rates to hand but I thought they put up their fixed rates by .5%? I'm open to correction on that
 
Thanks for your replies. Yes - they increased the rate (though with that new rate, they might have well as dropped it - its not exactly 'competitive'!). We are at the outer limits of our affordability.

When I look at todays current rates I still see BoS fixed 2 years at 4.58 - I called Halifax and they confirmed this rate.

I could try for this BoS rate - though I run the risk of the same thing happening again. Unless we try to get the whole process complete in 2 weeks.

We had being applying to UB with a broker (even though we have our current mortgage there). As we have our ufirst current accounts with UB and our previous mortgage, it may be worth pleading with them to give us the 4.65 3 yr fixed rate.

Has anyone found such pleading successful? Any pleading type tactics?
 
Has UB informed you that the rate will increase for you personally? There is a chance that they will honour the rate they quoted to you originally but you'd need to ask them directly to know for sure.
 
As mentioned above - make sure to concentrate on APR (or cost per thousand for a specified term) and not nominal rates when comparing different loans/lenders.
 
I was looking at IRR... SHould I not look at IRR?
e.g. I copied this from the online mortgage calc...It gives the repayments also which make it easy to compare

Lender Monthly Repayment IRR APR
Bank of Scotland EUR 3,825.79 4.58% 5.01%
Permanent tsb EUR 3,910.85 4.75% 5.10%
Bank Of Ireland EUR 3,930.99 4.79% 5.10%
AIB EUR 4,032.40 4.99% 4.78%
ICS EUR 4,032.40 4.99% 5.10%
Irish Nationwide EUR 4,032.40 4.99% 5.30%
INBS EUR 4,032.40 4.99% 5.30%
IIB EUR 4,083.54 5.09% 5.23%
Ulster Bank EUR 4,212.61 5.34% 5.60%
National Irish Bank EUR 4,217.81 5.35% 5.28%
First Active EUR 4,290.89 5.49% 5.40%
 
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Also, one last question ( i hope I am not pushing my luck on the questions here)
I assume (from reading the other posts on this matter) as we bought our first house in 2002. We are entitled to the FTB TRS until 2009 (even though this is our secnd house).

Would this be right?
 
Dublin6 said:
I was looking at IRR... SHould I not look at IRR?
e.g. I copied this from the online mortgage calc...It gives the repayments also which make it easy to compare

Lender Monthly Repayment IRR APR
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No idea what IRR is but you should be looking at APR.
 
7 years is correct, have you not been getting this? I recently have returned the TRS forms and was told I would be due back 1,400E and that was for one year.
 
Due to close with UB next week but UB are sticking with the increased rate. Wont stick by 4.65 even when losing business due to increase.
 
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