Key Post Switch or re-fix my mortgage? Breakage fee calculator and savings estimates for your case (Ireland)

[Paul F]

• Current lender – Haven Mortgages
• Outstanding mortgage balance (how much you still owe) €320k
• Approximate current value of your property €400k
• The date you started your fixed-rate mortgage (month and year) March 2020
• How many years you fixed for 3
• Your current mortgage interest rate 2.85%
• Your current monthly repayment (excluding any overpayments) €1269.67
• Your property's BER (Building Energy Rating) – check it here or estimate it if necessary D2
• Are you due to get extra cashback from your current lender in the future, e.g., "1% after 5 years", or "2% cashback monthly"? If so, how much (monetary amount) and when? None

@dotTom

• Switching immediately to Permanent TSB's 3-year fixed rate (2.5% with €6,400 initial cashback and 2% monthly cashback) will save you about €5,320 over the next 3 years
  • Note that Permanent TSB discriminate between new and existing customers, i.e., their best rates are not available to existing customers
  • For example, if you were an existing Permanent TSB customer, the best rate you would be able to switch to today is 2.95%
  • So if you switch to them now, you will not be eligible to switch to one of their low rates in the future and you will end up on a higher interest rate. When that happens, you may want to switch again to another lender, which will incur costs (and it might be impossible to switch if your financial situation has deteriorated).
  
  
• Switching immediately to Permanent TSB's 5-year fixed rate (2.55% with €6,400 initial cashback and 2% monthly cashback) will save you about €4,860 over the next 3 years
  • The same warnings as above regarding higher Permanent TSB rates in the future apply
  
  
• Switching immediately to AIB's 4-year fixed rate (2.2% with €2,000 cashback) will save you about €3,100 over the next 3 years
  
  
• Switching immediately to Avant Money's 4-year fixed rate (2.15% with no cashback) will save you about €1,520 over the next 3 years
  
  
• Switching immediately to Haven's 3-year fixed rate (2.35% with no cashback) will save you about €1,120 over the next 3 years. And it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
  
  
• Switching immediately to Avant Money's 5-year fixed rate (2.35% with no cashback) will leave you worse off by about €360 over the next 3 years
  
  
• Switching immediately to Haven's 5-year fixed rate (2.55% with no cashback) will leave you worse off by about €760 over the next 3 years. But it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
  
  
• Switching immediately to Avant Money's 7-year fixed rate (2.45% with no cashback) will leave you worse off by about €1,300 over the next 3 years – but with the longer security of 7 years on a fixed rate
  • This is much better value than Haven's 7-year rate over the next seven years
  
  
• Switching immediately to Haven's 7-year fixed rate (2.65% with no cashback) will leave you worse off by about €1,700 over the next 3 years – but with the longer security of 7 years on a fixed rate. And it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
  
  
• Switching immediately to Avant Money's 10-year fixed rate (2.6% with no cashback) will leave you worse off by about €2,720 over the next 3 years – but with the longer security of 10 years on a fixed rate
  • This is much better value than Haven's 10-year rate over the next ten years
  
  
• Switching immediately to Haven's 10-year fixed rate (2.85% with no cashback) will leave you worse off by about €3,580 over the next 3 years – but with the longer security of 10 years on a fixed rate. And it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
  
  
• Switching immediately to Avant Money's "One Mortgage" (a 2.75% fixed rate with no cashback) will leave you worse off by about €4,120 over the next 3 years – and the interest rate will remain fixed for the remainder of your mortgage term
  • You would have to shorten your mortgage term to 30 years to be eligible for this rate
  • The monthly repayment would be €1,306
  
  
• Switching immediately to Finance Ireland's 10- or 15-year fixed rate (3.15% with no cashback) will leave you worse off by about €7,920 over the next 3 years – but with the longer security of 10 or 15 years on a fixed rate
  • This product has a benefit in relation to moving home in the future that is explained below
  • And your interest rate (initially 3.15%) will automatically fall as time passes and you move into lower loan-to-value (LTV) brackets. See the section "How we decide rate reductions" on this page.
  
  
• Switching immediately to Finance Ireland's 20-year fixed rate (3.25% with no cashback) will leave you worse off by about €8,860 over the next 3 years – but with the longer security of 20 years on a fixed rate
  • This product has a benefit in relation to moving home in the future that is explained below
  • And your interest rate (initially 3.25%) will automatically fall as time passes and you move into lower loan-to-value (LTV) brackets. See the section "How we decide rate reductions" on this page.
  
  
• Switching immediately to Finance Ireland's 25-year fixed rate (3.4% with no cashback) will leave you worse off by about €10,280 over the next 3 years – but with the longer security of 25 years on a fixed rate
  • This product has a benefit in relation to moving home in the future that is explained below
  • And your interest rate (initially 3.4%) will automatically fall as time passes and you move into lower loan-to-value (LTV) brackets. See the section "How we decide rate reductions" on this page.

These savings estimates use for comparison the scenario of switching to the 2.35% rate with Haven when the current fixed rate ends. And that's assuming that Haven are even offering a 2.35% rate in March 2023 – it could be higher (or lower). The estimates also account for any fees (solicitors' fees, valuation fee) that you have to pay and any cashback offered by the above lenders.

Because your wife is currently on unpaid leave, it is not certain that you will be able to switch to another lender. You would need to talk to the lender or to a broker.

All of Avant's rates, and Finance Ireland's 10-year and longer fixed rates, allow you to avoid any potential break fee if you move home in the future (as long as you take out a new mortgage with them, and subject to certain conditions). And in the case of Finance Ireland you can "take your mortgage with you" – meaning that you get to keep the same interest rate when you move (again, subject to certain conditions).

The estimates also assume that your loan-to-value ratio (LTV) really is below 80% so that you are eligible for the listed rates. Your LTV estimate is 320.0k/400.0k = 80.0%. If you get a valuation of less than €400k, you will need to make a few more monthly mortgage payments and/or a lump sum overpayment to get the LTV below 80%. But that is not a reason to delay the switch – i.e., you can start the switch immediately.

Bear in mind that interest rates could rise between now and the time that you complete any switch, so if you are thinking of switching you should probably apply simultaneously to two or more lenders for approval in principle (AIP).

would we have enough time to complete it for the current offers around?

Nobody knows when the various lenders will put up their rates. Switching seems to take around 3 months on average.

Additional question; when can you lock in the fixed rate? Is at AIP stage/ letter of offer/ drawdown

Most lenders will not let you "lock in" a particular interest rate when you are in the middle of the switching process. For example, I know that AIB reserve the right to change the interest rate at any time right up to the point of drawdown.

One exception was Avant when they recently increased many of their rates: anyone who had started their switcher application by 13 May has until 15 July to drawdown at the old rates.

Avant to raise 5-20 year fixed rates, but lowers 30 year rate to 2.5%! (May 2022)

Avant will raise their 5-, 7-, 10-, 15-, and 20-year fixed rates for applications received after May 13th. The increases are of the order of 20-to-30 bps. https://www.rte.ie/news/business/2022/0506/1296524-avant-money-to-increase-some-mortgage-rates/ Their 3- and 4-year rates will remain...

www.askaboutmoney.com

But even Avant might not apply that policy again if they raise their rates in the future.

 

[bcc-orr]

Can you explain what you mean by the FYI? Do you mean the first few posts in this thread?


If you decide that you just want to re-fix with Bank of Ireland (instead of switching to another lender), you simply contact them and tell them that this is what you want to do. I'm not sure of the exact procedure for this with BOI – you probably have to tick the rate you want on a form and send it back to them – but you do not have to go onto a variable rate while the re-fix is underway.

If you are switching to another lender, you stay on your current fixed rate right up until you draw down the mortgage from the new lender. Then your solicitor tells BOI that you are paying off the mortgage in full. BOI then calculates the outstanding balance and adds on the break fee (if any) – this is the "redemption figure". Then the solicitor pays off the BOI mortgage with the money from the new lender.

@bcc-orr You should do what @fixedratenovice did: contact Bank of Ireland, tell them that you are planning to switch to another lender, and ask them what interest rate discount they would offer you to break and re-fix with Bank of Ireland. They offered @fixedratenovice a 0.2% discount to stay.

Hi Paul

thank you

I spoke to BOI and break fee currently 0 as you had expected.

Lowest rate they would offer to an existing for 10 years was 3.1.

Going to try see how long the Avant process takes me and if they are interested.

Many thanks

 

[dotTom]

@dotTom

• Switching immediately to Permanent TSB's 3-year fixed rate (2.5% with €6,400 initial cashback and 2% monthly cashback) will save you about €5,320 over the next 3 years
  • Note that Permanent TSB discriminate between new and existing customers, i.e., their best rates are not available to existing customers
  • For example, if you were an existing Permanent TSB customer, the best rate you would be able to switch to today is 2.95%
  • So if you switch to them now, you will not be eligible to switch to one of their low rates in the future and you will end up on a higher interest rate. When that happens, you may want to switch again to another lender, which will incur costs (and it might be impossible to switch if your financial situation has deteriorated).
  
  
• Switching immediately to Permanent TSB's 5-year fixed rate (2.55% with €6,400 initial cashback and 2% monthly cashback) will save you about €4,860 over the next 3 years
  • The same warnings as above regarding higher Permanent TSB rates in the future apply
  
  
• Switching immediately to AIB's 4-year fixed rate (2.2% with €2,000 cashback) will save you about €3,100 over the next 3 years
  
  
• Switching immediately to Avant Money's 4-year fixed rate (2.15% with no cashback) will save you about €1,520 over the next 3 years
  
  
• Switching immediately to Haven's 3-year fixed rate (2.35% with no cashback) will save you about €1,120 over the next 3 years. And it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
  
  
• Switching immediately to Avant Money's 5-year fixed rate (2.35% with no cashback) will leave you worse off by about €360 over the next 3 years
  
  
• Switching immediately to Haven's 5-year fixed rate (2.55% with no cashback) will leave you worse off by about €760 over the next 3 years. But it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
  
  
• Switching immediately to Avant Money's 7-year fixed rate (2.45% with no cashback) will leave you worse off by about €1,300 over the next 3 years – but with the longer security of 7 years on a fixed rate
  • This is much better value than Haven's 7-year rate over the next seven years
  
  
• Switching immediately to Haven's 7-year fixed rate (2.65% with no cashback) will leave you worse off by about €1,700 over the next 3 years – but with the longer security of 7 years on a fixed rate. And it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
  
  
• Switching immediately to Avant Money's 10-year fixed rate (2.6% with no cashback) will leave you worse off by about €2,720 over the next 3 years – but with the longer security of 10 years on a fixed rate
  • This is much better value than Haven's 10-year rate over the next ten years
  
  
• Switching immediately to Haven's 10-year fixed rate (2.85% with no cashback) will leave you worse off by about €3,580 over the next 3 years – but with the longer security of 10 years on a fixed rate. And it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
  
  
• Switching immediately to Avant Money's "One Mortgage" (a 2.75% fixed rate with no cashback) will leave you worse off by about €4,120 over the next 3 years – and the interest rate will remain fixed for the remainder of your mortgage term
  • You would have to shorten your mortgage term to 30 years to be eligible for this rate
  • The monthly repayment would be €1,306
  
  
• Switching immediately to Finance Ireland's 10- or 15-year fixed rate (3.15% with no cashback) will leave you worse off by about €7,920 over the next 3 years – but with the longer security of 10 or 15 years on a fixed rate
  • This product has a benefit in relation to moving home in the future that is explained below
  • And your interest rate (initially 3.15%) will automatically fall as time passes and you move into lower loan-to-value (LTV) brackets. See the section "How we decide rate reductions" on this page.
  
  
• Switching immediately to Finance Ireland's 20-year fixed rate (3.25% with no cashback) will leave you worse off by about €8,860 over the next 3 years – but with the longer security of 20 years on a fixed rate
  • This product has a benefit in relation to moving home in the future that is explained below
  • And your interest rate (initially 3.25%) will automatically fall as time passes and you move into lower loan-to-value (LTV) brackets. See the section "How we decide rate reductions" on this page.
  
  
• Switching immediately to Finance Ireland's 25-year fixed rate (3.4% with no cashback) will leave you worse off by about €10,280 over the next 3 years – but with the longer security of 25 years on a fixed rate
  • This product has a benefit in relation to moving home in the future that is explained below
  • And your interest rate (initially 3.4%) will automatically fall as time passes and you move into lower loan-to-value (LTV) brackets. See the section "How we decide rate reductions" on this page.

These savings estimates use for comparison the scenario of switching to the 2.35% rate with Haven when the current fixed rate ends. And that's assuming that Haven are even offering a 2.35% rate in March 2023 – it could be higher (or lower). The estimates also account for any fees (solicitors' fees, valuation fee) that you have to pay and any cashback offered by the above lenders.

Because your wife is currently on unpaid leave, it is not certain that you will be able to switch to another lender. You would need to talk to the lender or to a broker.

All of Avant's rates, and Finance Ireland's 10-year and longer fixed rates, allow you to avoid any potential break fee if you move home in the future (as long as you take out a new mortgage with them, and subject to certain conditions). And in the case of Finance Ireland you can "take your mortgage with you" – meaning that you get to keep the same interest rate when you move (again, subject to certain conditions).

The estimates also assume that your loan-to-value ratio (LTV) really is below 80% so that you are eligible for the listed rates. Your LTV estimate is 320.0k/400.0k = 80.0%. If you get a valuation of less than €400k, you will need to make a few more monthly mortgage payments and/or a lump sum overpayment to get the LTV below 80%. But that is not a reason to delay the switch – i.e., you can start the switch immediately.

Bear in mind that interest rates could rise between now and the time that you complete any switch, so if you are thinking of switching you should probably apply simultaneously to two or more lenders for approval in principle (AIP).


Nobody knows when the various lenders will put up their rates. Switching seems to take around 3 months on average.


Most lenders will not let you "lock in" a particular interest rate when you are in the middle of the switching process. For example, I know that AIB reserve the right to change the interest rate at any time right up to the point of drawdown.

One exception was Avant when they recently increased many of their rates: anyone who had started their switcher application by 13 May has until 15 July to drawdown at the old rates.

Avant to raise 5-20 year fixed rates, but lowers 30 year rate to 2.5%! (May 2022)

Avant will raise their 5-, 7-, 10-, 15-, and 20-year fixed rates for applications received after May 13th. The increases are of the order of 20-to-30 bps. https://www.rte.ie/news/business/2022/0506/1296524-avant-money-to-increase-some-mortgage-rates/ Their 3- and 4-year rates will remain...

www.askaboutmoney.com

But even Avant might not apply that policy again if they raise their rates in the future.

Hi Paul,
Thank you very much for the time taken to review and provide the calculations.

Would you mind also considering this scenario if you have time?

We may be able to bring our mortgage down to €200k for 50% LTV using a lump sum to pay off before we refix or switch.

Many thanks
Tom

 

[adam d]

Hi Paul,

Im looking for some advise please

Broker has advised I can't switch currently as i have small overdraft €4k, €2k credit card, Car Loan Payments etc.. All normal stuff, i will be tidying up my finances over the next 6-12 months.

Broker advised best option is to stick with KBC and lock in for 2 or 3 years @2.25% or 5 years @2.4%.

If i get my finances sorted in the new few months, is it better to fix short term now and then hopefully switch?


I'm hoping

• Current lender – KBC
• Outstanding mortgage balance (how much you still owe) €345,000
• Approximate current value of your property €620k
• The date you started your fixed-rate mortgage (month and year) July 2020
• How many years you fixed for 2 years
• Your current mortgage interest rate 2.3%
• Your current monthly repayment (excluding any overpayments) €1716.00
• Your property's BER (Building Energy Rating) – check it here or estimate it if necessary C1
• Are you due to get extra cashback from your current lender in the future, e.g., "1% after 5 years", or "2% cashback monthly"? If so, how much (monetary amount) and when? None

 

[NDynamite]

• Current lender – PTSB
• Outstanding mortgage balance (how much you still owe) €370k
• Approximate current value of your property €585k
• The date you started your fixed-rate mortgage (month and year) Sept 2021
• How many years you fixed for 3
• Your current mortgage interest rate 2.5%
• Your current monthly repayment (excluding any overpayments) €1614.00
• Your property's BER (Building Energy Rating) – check it here or estimate it if necessary D2
• Are you due to get extra cashback from your current lender in the future, e.g., "1% after 5 years", or "2% cashback monthly"? If so, how much (monetary amount) and when? None but as first time buyers received 2% at drawdown (€7600)

Other info: We know we are breaking quite early but our intention is to be ready at 10-12 months to switch to get a fixed rate. We would be happy to lock in 2.5pc for 10 years, perhaps 7 with Avant/BOI depending on what changes over coming months.
Is there any negotiation to be had with PTSB or is that a waste of time ?
Thanks so much !
A

 

[Paul F]

Would you mind also considering this scenario if you have time?

We may be able to bring our mortgage down to €200k for 50% LTV using a lump sum to pay off before we refix or switch.

@dotTom The below estimates assume that you reduce your balance to €240k (a loan-to-value ratio of 60%) and shorten your mortgage term to 30 years. The only lender who has a <50% LTV bracket is AIB, but by reducing your balance below €250k you become ineligible for their high-value 4-year fixed rate (2.2%).

• Switching immediately to Avant Money's 4-year fixed rate (1.95% with no cashback) will save you about €2,160 over the next 3 years
  • The monthly repayment would be €881
  
  
• Switching immediately to KBC's 5-year fixed rate (2.4% with €3,000 cashback) will save you about €2,040 over the next 3 years
  • The monthly repayment would be €936
  • Note that if you decide to do this, your mortgage will soon move onto Bank of Ireland's books, and they discriminate between new and existing customers, i.e., their best rates are not available to existing customers
  • For example, if you were an existing Bank of Ireland customer, the best rate you would be able to switch to today is 3.0%
  • So if you switch to this KBC offer now, you will probably not be eligible to switch to one of Bank of Ireland's low rates in the future and you will end up on a higher interest rate. When that happens, you may want to switch again to another lender, which will incur costs (and it might be impossible to switch if your financial situation has deteriorated).
  • You must apply by 15 July 2022 if you wish to switch to KBC. You would also have to apply for a current account with them by that date.
  
  
• Switching immediately to Avant Money's 5-year fixed rate (2.15% with no cashback) will save you about €760 over the next 3 years
  • The monthly repayment would be €905
  
  
• Switching immediately to Haven's 3-year fixed rate (2.35% with no cashback) will save you about €840 over the next 3 years. And it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
  • The monthly repayment would be €930
  
  
• Switching immediately to Avant Money's 7-year fixed rate (2.25% with no cashback) will save you about €60 over the next 3 years – but with the longer security of 7 years on a fixed rate
  • The monthly repayment would be €917
  
  
• Switching immediately to Haven's 5-year fixed rate (2.55% with no cashback) will leave you worse off by about €580 over the next 3 years. But it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
  • The monthly repayment would be €955
  
  
• Switching immediately to Avant Money's 10-year fixed rate (2.4% with no cashback) will leave you worse off by about €1,000 over the next 3 years – but with the longer security of 10 years on a fixed rate
  • The monthly repayment would be €936
  
  
• Switching immediately to Haven's 7-year fixed rate (2.65% with no cashback) will leave you worse off by about €1,280 over the next 3 years – but with the longer security of 7 years on a fixed rate. And it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
  • The monthly repayment would be €967
  
  
• Switching immediately to Avant Money's "One Mortgage" (a 2.5% fixed rate with no cashback) will leave you worse off by about €1,700 over the next 3 years – and the interest rate will remain fixed for the remainder of your mortgage term
  • You would have to shorten your mortgage term to 30 years to be eligible for this rate
  • The monthly repayment would be €948
  
  
• Switching immediately to Haven's 10-year fixed rate (2.85% with no cashback) will leave you worse off by about €2,700 over the next 3 years – but with the longer security of 10 years on a fixed rate. And it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
  • The monthly repayment would be €993
  
  
• Switching immediately to Finance Ireland's 10- or 15-year fixed rate (2.9% with no cashback) will leave you worse off by about €4,520 over the next 3 years – but with the longer security of 10 or 15 years on a fixed rate
  • The monthly repayment would be €999
  • This product has a benefit in relation to moving home in the future that is explained below
  
  
• Switching immediately to Finance Ireland's 20-year fixed rate (3.0% with no cashback) will leave you worse off by about €5,240 over the next 3 years – but with the longer security of 20 years on a fixed rate
  • The monthly repayment would be €1,012
  • This product has a benefit in relation to moving home in the future that is explained below
  
  
• Switching immediately to Finance Ireland's 25-year fixed rate (3.15% with no cashback) will leave you worse off by about €6,300 over the next 3 years – but with the longer security of 25 years on a fixed rate
  • The monthly repayment would be €1,031
  • This product has a benefit in relation to moving home in the future that is explained below

These savings estimates use for comparison the scenario of switching to the 2.35% rate with Haven when the current fixed rate ends. And that's assuming that Haven are even offering a 2.35% rate in March 2023 – it could be higher (or lower). The estimates also account for any fees (solicitors' fees, valuation fee) that you have to pay and any cashback offered by the above lenders.

Notice how there is no difference in the Haven interest rates you are eligible for now and the the rates you would be eligible for if you reduced your mortgage balance.

All of Avant's rates, and Finance Ireland's 10-year and longer fixed rates, allow you to avoid any potential break fee if you move home in the future (as long as you take out a new mortgage with them, and subject to certain conditions). And in the case of Finance Ireland you can "take your mortgage with you" – meaning that you get to keep the same interest rate when you move (again, subject to certain conditions).

Remember that if you switch to a 10-year or longer fixed rate with Finance Ireland, your interest rate will automatically fall in future years as your loan-to-value ratio falls (from your current LTV of 80%). In this scenario, reducing your balance right now becomes less important because, even if you don't, you will still get the lower interest rates in future years.

Bear in mind that interest rates could rise between now and the time that you complete any switch, so if you are thinking of switching you should probably apply simultaneously to two or more lenders for approval in principle (AIP).

Overpaying your mortgage/reducing your balance may not be the best use of your money. Your priorities should usually be:

• Paying off expensive debt (credit cards, personal loans, car loans, etc.)
• Building up an emergency fund in a savings/current account (3 to 6 months' living expenses)
• Saving money for any expenses you will have over the next few years (kids; buying a car; childcare; home renovations; adult children going to college, etc.)
• Maxing out your pension contributions (very large tax relief is given)
• Overpaying your mortgage

in approximately that order. Consider posting a thread about your situation in the Money Makeover forum.

 

[Paul F]

Lowest rate they [BOI] would offer to an existing for 10 years was 3.1.

Going to try see how long the Avant process takes me and if they are interested.

@bcc-orr It seems to be taking people about 3 to 4 months to switch, on average.

 

[Paul F]

Are you due to get extra cashback from your current lender in the future, e.g., "1% after 5 years", or "2% cashback monthly"? If so, how much (monetary amount) and when? None but as first time buyers received 2% at drawdown (€7600)

@NDynamite Just curious as to why you are not getting the 2% monthly cashback?

 

[NDynamite]

@NDynamite Just curious as to why you are not getting the 2% monthly cashback?

@NDynamite Just curious as to why you are not getting the 2% monthly cashback?

Hi @Paul F
We are first time buyers and the deal was an upfront payment at drawdown ? I thought that is how it works? There is €32 per month cash earned on our mortgage account that could be it, but I thought that was a benefit to having current account with the lender. It's eroded by bank fees anyway so looked irrelevant to me.

 

[Paul F]

• Current lender – KBC
• Outstanding mortgage balance (how much you still owe) €345,000
• Approximate current value of your property €620k
• The date you started your fixed-rate mortgage (month and year) July 2020
• How many years you fixed for 2 years
• Your current mortgage interest rate 2.3%
• Your current monthly repayment (excluding any overpayments) €1716.00
• Your property's BER (Building Energy Rating) – check it here or estimate it if necessary C1
• Are you due to get extra cashback from your current lender in the future, e.g., "1% after 5 years", or "2% cashback monthly"? If so, how much (monetary amount) and when? None

@adam d Your break fee should be zero at the moment – but it is volatile because wholesale interest rates are volatile, so confirm it with KBC. If it is higher than zero, please post it here when you receive it, including the date of the letter.

• Switching immediately to Permanent TSB's 5-year fixed rate (2.55% with €6,900 initial cashback and 2% monthly cashback) will save you about €3,500 over the next 3 years
  • Note that Permanent TSB discriminate between new and existing customers, i.e., their best rates are not available to existing customers
  • For example, if you were an existing Permanent TSB customer, the best rate you would be able to switch to today is 2.95%
  • So if you switch to them now, you will not be eligible to switch to one of their low rates in the future and you will end up on a higher interest rate. When that happens, you may want to switch again to another lender, which will incur costs (and it might be impossible to switch if your financial situation has deteriorated).
  
  
• Switching immediately to Haven's 3-year fixed rate (2.35% with €5,000 cashback) will save you about €2,540 over the next 3 years
  
  
• Switching immediately to Avant Money's 4-year fixed rate (1.95% with no cashback) will save you about €1,460 over the next 3 years
  
  
• Switching immediately to AIB's 4-year fixed rate (2.2% with €2,000 cashback) will save you about €1,020 over the next 3 years
  
  
• Switching immediately to Haven's 5-year fixed rate (2.55% with €5,000 cashback) will save you about €560 over the next 3 years
  
  
• Switching immediately to KBC's 3-year fixed rate (2.25% with no cashback) will not save you or cost you anything over the next 3 years. But it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
  • Note that if you decide to do this, your mortgage will soon move onto Bank of Ireland's books, and they discriminate between new and existing customers, i.e., their best rates are not available to existing customers
  • For example, if you were an existing Bank of Ireland customer, the best rate you would be able to switch to today is 3.0%
  • So if you switch to this KBC offer now, you will probably not be eligible to switch to one of Bank of Ireland's low rates in the future and you will end up on a higher interest rate. When that happens, you may want to switch again to another lender, which will incur costs (and it might be impossible to switch if your financial situation has deteriorated).
  
  
• Switching immediately to Avant Money's 5-year fixed rate (2.15% with no cashback) will leave you worse off by about €520 over the next 3 years
  
  
• Switching immediately to AIB's 5-year fixed rate (2.45% with €2,000 cashback) will leave you worse off by about €1,460 over the next 3 years
  
  
• Switching immediately to Avant Money's 7-year fixed rate (2.25% with no cashback) will leave you worse off by about €1,500 over the next 3 years – but with the longer security of 7 years on a fixed rate
  • If Avant won't let you switch to them and you really want to fix for 7 years for some reason, you could consider Haven's 7-year fixed rate (2.65% with €5,000 cashback)
  
  
• Switching immediately to KBC's 5-year fixed rate (2.4% with no cashback) will leave you worse off by about €1,510 over the next 3 years. But it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
  • The same warnings as above regarding higher Bank of Ireland rates in the future apply
  
  
• Switching immediately to Avant Money's 10-year fixed rate (2.4% with no cashback) will leave you worse off by about €3,000 over the next 3 years – but with the longer security of 10 years on a fixed rate
  • If Avant won't let you switch to them and you really want to fix for 10 years for some reason, you could consider Haven's 10-year fixed rate (2.85% with €5,000 cashback)
  
  
• Switching immediately to Avant Money's "One Mortgage" (a 2.5% fixed rate with no cashback) will leave you worse off by about €3,980 over the next 3 years – and the interest rate will remain fixed for the remainder of your mortgage term (approximately 21 years)
  
  
• Switching immediately to KBC's 10-year fixed rate (2.85% with no cashback) will leave you worse off by about €6,000 over the next 3 years – but with the longer security of 10 years on a fixed rate. And it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
  • The same warnings as above regarding higher Bank of Ireland rates in the future apply
  
  
• Switching immediately to Finance Ireland's 10- or 15-year fixed rate (2.9% with no cashback) will leave you worse off by about €7,960 over the next 3 years – but with the longer security of 10 or 15 years on a fixed rate
  • This product has a benefit in relation to moving home in the future that is explained below
  
  
• Switching immediately to Finance Ireland's 20-year fixed rate (3.0% with no cashback) will leave you worse off by about €8,960 over the next 3 years – but with the longer security of 20 years on a fixed rate
  • This product has a benefit in relation to moving home in the future that is explained below

These savings estimates use for comparison the scenario of switching to the 2.25% rate with KBC when the current fixed rate ends. And that's assuming that KBC (or Bank of Ireland, if they have taken over your mortgage by then) are even offering a 2.25% rate later this month – it could be higher (or lower). The estimates also account for any fees (solicitors' fees, valuation fee) that you have to pay and any cashback offered by the above lenders.

It may seem like it is not worth switching to another lender but bear in mind that your mortgage will soon be owned by Bank of Ireland, whose rates are much higher than KBC's. So if you don't switch now, you might find that you really want to switch in a few years' time, at which point rates might be higher (and it might be impossible to switch if your financial situation has deteriorated).

All of Avant's rates, and Finance Ireland's 10-year and longer fixed rates, allow you to avoid any potential break fee if you move home in the future (as long as you take out a new mortgage with them, and subject to certain conditions). And in the case of Finance Ireland you can "take your mortgage with you" – meaning that you get to keep the same interest rate when you move (again, subject to certain conditions).

The estimates also assume that your loan-to-value ratio (LTV) really is below 60% so that you are eligible for the listed rates. Your LTV estimate is 345.0k/620.0k = 55.6%. If you get a valuation of less than €575k, you will need to make a few more monthly mortgage payments and/or a lump sum overpayment to get the LTV below 60%. But that is not a reason to delay the switch – i.e., you can start the switch immediately.

Bear in mind that interest rates could rise between now and the time that you complete any switch, so if you are thinking of switching you should probably apply simultaneously to two or more lenders for approval in principle (AIP).

If i get my finances sorted in the new few months, is it better to fix short term now and then hopefully switch?

The risk of re-fixing for the long term, e.g., for 5 or 10 years, with KBC is that there could be a large break fee when you go to switch to another lender. That will happen if interbank interest rates fall between now and when you switch, and in such a case the break fee will be higher if you fixed for 10 years versus 5 years. If interbank rates rise, there will be no break fee.

The risk of re-fixing for the short term, e.g., for 2 or 3 years, with KBC is that all lenders might increase their rates soon, which might make it not worth your while to switch, and then you would only have the security of your current fixed rate for the next two or three years.

Finance Ireland have a reputation for being a bit more liberal when it comes to lending, so you could approach them now (via a broker) and see what their attitude is to letting you switch now – if their rates appeal to you.

 

[bennybob]

Hi Folks,

Interesting switch information, I received a loan offer from AIB to switch my mortgage despite only being with my current lender four months and no mention of a wait time of six months during the application process.

I spoke to my solicitor and they said the switch will take 4 - 8 weeks to complete. Considering that the ECB will move on rates at their next meeting in a couple of weeks time, is it a bad idea to try and switch as AIB may increase their rates shortly after the ECB's decision? I could then end up on a higher rate than what I am on at the moment. I suppose what I am wondering is have I missed the boat.

 

[IrishGunner]

@IrishGunner Because you are on a variable-rate mortgage, you do not have to pay a break fee.

• Switching immediately to Haven's 4-year green fixed rate (2.0% with €2,000 cashback) will save you about €14,500 over the next 4 years
  • You need a Building Energy Rating (BER) of B3 or better to be eligible for this rate
  
  
• Switching immediately to AIB's 5-year green fixed rate (2.1% with €2,000 cashback) will save you about €13,680 over the next 4 years
  • And it is quite likely that you will be able to make unlimited overpayments without penalty for the foreseeable future (see this thread)
  • You need a Building Energy Rating (BER) of B3 or better to be eligible for this rate
  
  
• Switching immediately to Avant Money's 4-year fixed rate (1.95% with no cashback) will save you about €13,080 over the next 4 years
  
  
• Switching immediately to AIB's 5-year fixed rate (2.35% with €2,000 cashback) will save you about €11,820 over the next 4 years
  
  
• Switching immediately to Avant Money's 5-year fixed rate (2.15% with no cashback) will save you about €11,420 over the next 4 years
  
  
• Switching immediately to Ulster Bank's 4- or 5-year fixed rate (2.35% with no cashback) will save you about €11,260 over the next 4 years. And it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
  • Note that if you decide to do this, your mortgage will soon move onto Permanent TSB's books, and they discriminate between new and existing customers, i.e., their best rates are not available to existing customers
  • For example, if you were an existing Permanent TSB customer, the best rate you would be able to switch to today is 3.0%
  • So if you switch to this Ulster Bank offer now, you will probably not be eligible to switch to one of Permanent TSB's low rates in the future and you will end up on a higher interest rate. When that happens, you may want to switch again to another lender, which will incur costs (and it might be impossible to switch if your financial situation has deteriorated).
  
  
• Switching immediately to Avant Money's 7-year fixed rate (2.25% with no cashback) will save you about €10,600 over the next 4 years – but with the longer security of 7 years on a fixed rate
  
  
• Switching immediately to Avant Money's 10-year fixed rate (2.4% with no cashback) will save you about €9,360 over the next 4 years – but with the longer security of 10 years on a fixed rate
  
  
• Switching immediately to Avant Money's "One Mortgage" (a 2.4% fixed rate with no cashback) will save you about €9,200 over the next 4 years – and the interest rate will remain fixed for the remainder of your mortgage term
  • You would have to shorten your mortgage term to 15 years to be eligible for this rate
  • The monthly repayment would be €1,492
  
  
• Switching immediately to Avant Money's "One Mortgage" (a 2.5% fixed rate with no cashback) will save you about €8,540 over the next 4 years – and the interest rate will remain fixed for the remainder of your mortgage term (approximately 17 years)
  
  
• Switching immediately to Ulster Bank's 7- or 10-year fixed rate (2.8% with no cashback) will save you about €7,540 over the next 4 years – but with the longer security of 7 or 10 years on a fixed rate. And it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
  • The same warnings as above regarding higher Permanent TSB rates in the future apply
  
  
• Switching immediately to Finance Ireland's 10- or 15-year fixed rate (2.9% with no cashback) will save you about €5,220 over the next 4 years – but with the longer security of 10 or 15 years on a fixed rate
  • This product has a benefit in relation to moving home in the future that is explained below

These savings estimates use for comparison the scenario of staying on the variable rate with Ulster Bank and assume that that rate doesn't change between now and July 2026 (which is very unlikely). The estimates also account for any fees (solicitors' fees, valuation fee) that you have to pay and any cashback offered by the above lenders.

All of Avant's rates, and Finance Ireland's 10-year and longer fixed rates, allow you to avoid any potential break fee if you move home in the future (as long as you take out a new mortgage with them, and subject to certain conditions). And in the case of Finance Ireland you can "take your mortgage with you" – meaning that you get to keep the same interest rate when you move (again, subject to certain conditions).


I'm wondering why your Ulster Bank variable rate is 3.7% and not 3.5%. What estimated property value and loan-to-value (LTV) ratio is showing when you log in to UB's Manage My Mortgage portal?


The above estimates assume that those rate rises have occurred. But keep pushing Avant and your solicitor and see if you can beat that deadline.


You would only be eligible for the Haven and AIB green rates if you get a BER of B3 or better. And you'd be starting the switching process from scratch, so you'd run the same risk of interest rates increasing before you draw down.


That is weird and sounds totally wrong. Are you sure that is what the broker said? Anyway, it doesn't matter because <60% LTV is Avant's lowest LTV bracket.


It would seem so. Your main decision is how long to fix for.

Thanks

Yes on 3.7% with UB and the LTV ratio is 51% and value €441,572.

Dont think we can reach the BER of B3 at the moment but have not got one done since renovations dont think it will jump from d1 to B3 or better

As for the LTV rate Broker did say based on salaries exact words "Loan amount remains the same as this is based on your salaries" although seems that we are getting the lowest LTV bracket. Its just that we also asked for top up but not getting that as Miss Gunner on parental leave one day week, even got letter from Job to say when it will finish but did not give it to us??

Looking at going the 7 years at this stage its going to be 2.25 and not the 1.95%

 

[adam d]

@adam d Your break fee should be zero at the moment – but it is volatile because wholesale interest rates are volatile, so confirm it with KBC. If it is higher than zero, please post it here when you receive it, including the date of the letter.

• Switching immediately to Permanent TSB's 5-year fixed rate (2.55% with €6,900 initial cashback and 2% monthly cashback) will save you about €3,500 over the next 3 years
  • Note that Permanent TSB discriminate between new and existing customers, i.e., their best rates are not available to existing customers
  • For example, if you were an existing Permanent TSB customer, the best rate you would be able to switch to today is 2.95%
  • So if you switch to them now, you will not be eligible to switch to one of their low rates in the future and you will end up on a higher interest rate. When that happens, you may want to switch again to another lender, which will incur costs (and it might be impossible to switch if your financial situation has deteriorated).
  
  
• Switching immediately to Haven's 3-year fixed rate (2.35% with €5,000 cashback) will save you about €2,540 over the next 3 years
  
  
• Switching immediately to Avant Money's 4-year fixed rate (1.95% with no cashback) will save you about €1,460 over the next 3 years
  
  
• Switching immediately to AIB's 4-year fixed rate (2.2% with €2,000 cashback) will save you about €1,020 over the next 3 years
  
  
• Switching immediately to Haven's 5-year fixed rate (2.55% with €5,000 cashback) will save you about €560 over the next 3 years
  
  
• Switching immediately to KBC's 3-year fixed rate (2.25% with no cashback) will not save you or cost you anything over the next 3 years. But it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
  • Note that if you decide to do this, your mortgage will soon move onto Bank of Ireland's books, and they discriminate between new and existing customers, i.e., their best rates are not available to existing customers
  • For example, if you were an existing Bank of Ireland customer, the best rate you would be able to switch to today is 3.0%
  • So if you switch to this KBC offer now, you will probably not be eligible to switch to one of Bank of Ireland's low rates in the future and you will end up on a higher interest rate. When that happens, you may want to switch again to another lender, which will incur costs (and it might be impossible to switch if your financial situation has deteriorated).
  
  
• Switching immediately to Avant Money's 5-year fixed rate (2.15% with no cashback) will leave you worse off by about €520 over the next 3 years
  
  
• Switching immediately to AIB's 5-year fixed rate (2.45% with €2,000 cashback) will leave you worse off by about €1,460 over the next 3 years
  
  
• Switching immediately to Avant Money's 7-year fixed rate (2.25% with no cashback) will leave you worse off by about €1,500 over the next 3 years – but with the longer security of 7 years on a fixed rate
  • If Avant won't let you switch to them and you really want to fix for 7 years for some reason, you could consider Haven's 7-year fixed rate (2.65% with €5,000 cashback)
  
  
• Switching immediately to KBC's 5-year fixed rate (2.4% with no cashback) will leave you worse off by about €1,510 over the next 3 years. But it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
  • The same warnings as above regarding higher Bank of Ireland rates in the future apply
  
  
• Switching immediately to Avant Money's 10-year fixed rate (2.4% with no cashback) will leave you worse off by about €3,000 over the next 3 years – but with the longer security of 10 years on a fixed rate
  • If Avant won't let you switch to them and you really want to fix for 10 years for some reason, you could consider Haven's 10-year fixed rate (2.85% with €5,000 cashback)
  
  
• Switching immediately to Avant Money's "One Mortgage" (a 2.5% fixed rate with no cashback) will leave you worse off by about €3,980 over the next 3 years – and the interest rate will remain fixed for the remainder of your mortgage term (approximately 21 years)
  
  
• Switching immediately to KBC's 10-year fixed rate (2.85% with no cashback) will leave you worse off by about €6,000 over the next 3 years – but with the longer security of 10 years on a fixed rate. And it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
  • The same warnings as above regarding higher Bank of Ireland rates in the future apply
  
  
• Switching immediately to Finance Ireland's 10- or 15-year fixed rate (2.9% with no cashback) will leave you worse off by about €7,960 over the next 3 years – but with the longer security of 10 or 15 years on a fixed rate
  • This product has a benefit in relation to moving home in the future that is explained below
  
  
• Switching immediately to Finance Ireland's 20-year fixed rate (3.0% with no cashback) will leave you worse off by about €8,960 over the next 3 years – but with the longer security of 20 years on a fixed rate
  • This product has a benefit in relation to moving home in the future that is explained below

These savings estimates use for comparison the scenario of switching to the 2.25% rate with KBC when the current fixed rate ends. And that's assuming that KBC (or Bank of Ireland, if they have taken over your mortgage by then) are even offering a 2.25% rate later this month – it could be higher (or lower). The estimates also account for any fees (solicitors' fees, valuation fee) that you have to pay and any cashback offered by the above lenders.

It may seem like it is not worth switching to another lender but bear in mind that your mortgage will soon be owned by Bank of Ireland, whose rates are much higher than KBC's. So if you don't switch now, you might find that you really want to switch in a few years' time, at which point rates might be higher (and it might be impossible to switch if your financial situation has deteriorated).

All of Avant's rates, and Finance Ireland's 10-year and longer fixed rates, allow you to avoid any potential break fee if you move home in the future (as long as you take out a new mortgage with them, and subject to certain conditions). And in the case of Finance Ireland you can "take your mortgage with you" – meaning that you get to keep the same interest rate when you move (again, subject to certain conditions).

The estimates also assume that your loan-to-value ratio (LTV) really is below 60% so that you are eligible for the listed rates. Your LTV estimate is 345.0k/620.0k = 55.6%. If you get a valuation of less than €575k, you will need to make a few more monthly mortgage payments and/or a lump sum overpayment to get the LTV below 60%. But that is not a reason to delay the switch – i.e., you can start the switch immediately.

Bear in mind that interest rates could rise between now and the time that you complete any switch, so if you are thinking of switching you should probably apply simultaneously to two or more lenders for approval in principle (AIP).


The risk of re-fixing for the long term, e.g., for 5 or 10 years, with KBC is that there could be a large break fee when you go to switch to another lender. That will happen if interbank interest rates fall between now and when you switch, and in such a case the break fee will be higher if you fixed for 10 years versus 5 years. If interbank rates rise, there will be no break fee.

The risk of re-fixing for the short term, e.g., for 2 or 3 years, with KBC is that all lenders might increase their rates soon, which might make it not worth your while to switch, and then you would only have the security of your current fixed rate for the next two or three years.

Finance Ireland have a reputation for being a bit more liberal when it comes to lending, so you could approach them now (via a broker) and see what their attitude is to letting you switch now – if their rates appeal to you.

Really appreciate the time you have taken and all the info you have provided Paul. A lot to think about, need to process and then decide on my next move.

 

[Paul F]

• Current lender – PTSB
• Outstanding mortgage balance (how much you still owe) €370k
• Approximate current value of your property €585k
• The date you started your fixed-rate mortgage (month and year) Sept 2021
• How many years you fixed for 3
• Your current mortgage interest rate 2.5%
• Your current monthly repayment (excluding any overpayments) €1614.00
• Your property's BER (Building Energy Rating) – check it here or estimate it if necessary D2
• Are you due to get extra cashback from your current lender in the future, e.g., "1% after 5 years", or "2% cashback monthly"? If so, how much (monetary amount) and when? None but as first time buyers received 2% at drawdown (€7600) [2% cashback monthly]

@NDynamite Your break fee should be zero at the moment – but it is volatile because wholesale interest rates are volatile, so confirm it with Permanent TSB. If it is higher than zero, please post it here when you receive it, including the date of the letter.

• Switching immediately to Avant Money's 4-year fixed rate (2.05% with no cashback) will save you about €6,400 over the next 4 years
  
  
• Switching immediately to AIB's 4-year fixed rate (2.2% with €2,000 cashback) will save you about €6,300 over the next 4 years
  
  
• Switching immediately to Haven's 5-year fixed rate (2.55% with €5,000 cashback) will save you about €4,320 over the next 4 years
  
  
• Switching immediately to Avant Money's 5-year fixed rate (2.25% with no cashback) will save you about €3,560 over the next 4 years
  
  
• Switching immediately to Avant Money's 7-year fixed rate (2.35% with no cashback) will save you about €2,140 over the next 4 years – but with the longer security of 7 years on a fixed rate
  • If Avant won't let you switch to them and you really want to fix for 7 years for some reason, you could consider Haven's 7-year fixed rate (2.65% with €5,000 cashback)
  
  
• Switching immediately to Avant Money's 10-year fixed rate (2.5% with no cashback) will not save you or cost you anything over the next 4 years – but with the longer security of 10 years on a fixed rate
  • If Avant won't let you switch to them and you really want to fix for 10 years for some reason, you could consider Haven's 10-year fixed rate (2.85% with €5,000 cashback)
  
  
• Switching immediately to Permanent TSB's 5- or 7-year fixed rate (3.0% with 2% monthly cashback) will leave you worse off by about €4,400 over the next 4 years – but with the longer security of 5 or 7 years on a fixed rate. And it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
  
  
• Switching immediately to Finance Ireland's 10- or 15-year fixed rate (3.05% with no cashback) will leave you worse off by about €7,860 over the next 4 years – but with the longer security of 10 or 15 years on a fixed rate
  • This product has a benefit in relation to moving home in the future that is explained below
  • And your interest rate (initially 3.05%) will automatically fall as time passes and you move into lower loan-to-value (LTV) brackets. See the section "How we decide rate reductions" on this page.
  
  
• Switching immediately to Finance Ireland's 20-year fixed rate (3.15% with no cashback) will leave you worse off by about €9,280 over the next 4 years – but with the longer security of 20 years on a fixed rate
  • This product has a benefit in relation to moving home in the future that is explained below
  • And your interest rate (initially 3.15%) will automatically fall as time passes and you move into lower loan-to-value (LTV) brackets. See the section "How we decide rate reductions" on this page.
  
  
• Switching immediately to Finance Ireland's 25-year fixed rate (3.3% with no cashback) will leave you worse off by about €11,440 over the next 4 years – but with the longer security of 25 years on a fixed rate
  • This product has a benefit in relation to moving home in the future that is explained below
  • And your interest rate (initially 3.3%) will automatically fall as time passes and you move into lower loan-to-value (LTV) brackets. See the section "How we decide rate reductions" on this page.

These savings estimates use for comparison the scenario of switching to the 2.95% rate with Permanent TSB when the current fixed rate ends. And that's assuming that Permanent TSB are even offering a 2.95% rate in September 2024 – it could be higher (or lower). You would continue to get the Permanent TSB monthly cashback in such a scenario. The estimates also account for any fees (solicitors' fees, valuation fee) that you have to pay and any cashback offered by the above lenders.

All of Avant's rates, and Finance Ireland's 10-year and longer fixed rates, allow you to avoid any potential break fee if you move home in the future (as long as you take out a new mortgage with them, and subject to certain conditions). And in the case of Finance Ireland you can "take your mortgage with you" – meaning that you get to keep the same interest rate when you move (again, subject to certain conditions).

The estimates also assume that your loan-to-value ratio (LTV) is currently 370.0k/585.0k = 63.2%. A higher property valuation (€617k) and/or a few more monthly mortgage payments and/or a lump sum overpayment would get you into a lower LTV bracket (< 60%), and you would be eligible for lower rates from Avant. But that is probably not a good reason to delay the switch – i.e., you can start the switch immediately.

Bear in mind that interest rates could rise between now and the time that you complete any switch, so if you are thinking of switching you should probably apply simultaneously to two or more lenders for approval in principle (AIP).

Other info: We know we are breaking quite early but our intention is to be ready at 10-12 months to switch to get a fixed rate. We would be happy to lock in 2.5pc for 10 years, perhaps 7 with Avant/BOI depending on what changes over coming months.

Avant will only let you switch to them if you have had a mortgage with your current lender for at least 12 months. AIB accept switchers once they have been with their current lender for at least 6 months, and Finance Ireland apparently have no minimum time period. Haven's rule is unknown. See this thread for more details.

You may be able to start the process of switching to Avant now, provided you don't draw down with them until you have been with PTSB for 12 months. Ask a couple of brokers if this is the case.

Is there any negotiation to be had with PTSB or is that a waste of time ?

No harm in asking – but you should start the process of switching to another lender while you wait for an answer from PTSB.

Just curious as to why you are not getting the 2% monthly cashback?

There is €32 per month cash earned on our mortgage account that could be it, but I thought that was a benefit to having current account with the lender. It's eroded by bank fees anyway so looked irrelevant to me.

That is the 2% monthly cashback for having a mortgage and an Explore account with PTSB. It is still €312 per year in cashback after fees. The above savings estimates account for it.

 

[Paul F]

Interesting switch information, I received a loan offer from AIB to switch my mortgage despite only being with my current lender four months and no mention of a wait time of six months during the application process.

Do you mean you received approval in principle or a full loan offer from AIB?

I spoke to my solicitor and they said the switch will take 4 - 8 weeks to complete. Considering that the ECB will move on rates at their next meeting in a couple of weeks time, is it a bad idea to try and switch as AIB may increase their rates shortly after the ECB's decision? I could then end up on a higher rate than what I am on at the moment. I suppose what I am wondering is have I missed the boat.

That will depend on when, and by how much, AIB increase their rates, which nobody can predict accurately. Even if AIB's 2.2% rate is increased to something a bit higher than your current 2.35% rate, bear in mind that you would have the security of 4 years on a fixed rate with AIB (versus about 2.5 more years with ICS). So while you might lose out now, you might gain in 2.5 years – depending on where rates are then.

You might want to ask your solicitor what they would charge you if you abandoned the switch in 3 weeks, 6 weeks, 9 weeks, etc., from now.

 

[Paul F]

Was on fixed term rate with UB for 2 years but this expired [in February 2022]

I guess that Ulster Bank have an old valuation on file for your property, so you rolled off the fixed rate onto the 3.7% rate. If you had got them to revalue your property you would have been eligible for the 3.1% variable rate (assuming you pay your mortgage from a UB current account), or a 2.2% fixed rate. Do you pay your mortgage from a UB current account?

Also our LTV is good but we are only getting the 60% LTV as its based on our salary and not on our House value. This is what broker is saying which we find weird?

As for the LTV rate Broker did say based on salaries exact words "Loan amount remains the same as this is based on your salaries" although seems that we are getting the lowest LTV bracket. Its just that we also asked for top up but not getting that as Miss Gunner on parental leave one day week, even got letter from Job to say when it will finish but did not give it to us??

Based on the broker's words that you quoted, they said nothing about LTV. The LTV (loan-to-value ratio) is the loan amount divided by the property value. As an example, if the loan amount is €195k and your property is worth €300k, your LTV is 195/300 = 65%.

The broker said that the loan amount depends on your salaries. Your salary never affects your eligibility for a particular LTV bracket, it only affects the amount you can borrow.

 

[Paul F]

From the links you provided it looks the interbank rate used by BOI if I fixed for 10 years right now would be ~2.5%? So if, for example, I sought to break out of the fixed rate in five years time and the ECB had raised rates from what there are now, it is likely (but not certain) that the interbank rate would be higher than it is now (and also in that case the relevant rate would be BOI's 5 year interbank rate)? So the main risk of a very high break fee is if ECB rates, and hence the interbank rates, fall from what they are now, as well as how long is left of my fixed period.

That is all correct. (Note that the swap rates that I linked to are only a proxy for the rates that BOI use.)

Presumably, R1% is the interbank rate and this is rate that BOI can deposit funds with another bank for? Also, will BOI tell me what R% is if I ask them?

I'm not sure exactly what rates BOI use in their calculations. I know that KBC will tell their customers (on request) what values they used for R and R1 in a break fee quote but I don't know if BOI do.

Anyway, I am leaning towards going with BOI's 10 year fixed because interest rates and rising and the chance of rates significantly lower than they are now is relatively low (I think!) - I'm just trying to tease out the risk of a large break fee down the line. It may be safer to take BOI's 5 year fixed and hope rates aren't significantly higher in 2027...

All we can really say is that if interbank rates fall between the time you fixed and the time you break, there will be a break fee – and that, on average, the break fee will be higher if you had fixed for 10 years than if you had fixed for 5 years.

 

[IrishGunner]

I guess that Ulster Bank have an old valuation on file for your property, so you rolled off the fixed rate onto the 3.7% rate. If you had got them to revalue your property you would have been eligible for the 3.1% variable rate (assuming you pay your mortgage from a UB current account), or a 2.2% fixed rate. Do you pay your mortgage from a UB current account?



Based on the broker's words that you quoted, they said nothing about LTV. The LTV (loan-to-value ratio) is the loan amount divided by the property value. As an example, if the loan amount is €195k and your property is worth €300k, your LTV is 195/300 = 65%.

The broker said that the loan amount depends on your salaries. Your salary never affects your eligibility for a particular LTV bracket, it only affects the amount you can borrow.

Nope our Mortgage is coming out of current account with KBC so have to switch that but thats for another day

Based on what you said and what we got v value works out about 49%. We asked for a top up but only got 13% of what we requested and this was due to Miss Gunner salary

 

[fjcie1]

Hi Paul,

Brilliant stuff from you helping so many people out. Would be very grateful if you could look at my scenario...

• Current lender – BOI
• Outstanding mortgage balance (how much you still owe) €220k
• Approximate current value of your property €450k
• The date you started your fixed-rate mortgage (month and year) May 2021
• How many years you fixed for 1 year (so hence I was recently placed on BOIs variable rate)
• Your current mortgage interest rate 3.9% Variable (Initial 1 year fixed rate was 2.7%)
• Your current monthly repayment (excluding any overpayments) €1044 (was €896 a month while on the fixed rate)
• Your property's BER (Building Energy Rating) – check it here or estimate it if necessary A2
• Are you due to get extra cashback from your current lender in the future, e.g., "1% after 5 years", or "2% cashback monthly"? If so, how much (monetary amount) and when? €2260 in May2026 (1% after 5 years)
• Have just today had a completed mortgage application sent to Avant by my broker. I have not decided on a rate yet

Thanks in advance

 

[jim]

Your break fee should be zero at the moment

Hopefully if you click that quote itll bring you back to my particular case in the thread.
I rang ebs and they quoted me 2693.59 to break theyre going to post me a letter and ill confirm details when I receive that. Is there any way that they could be mistaken, i was really hooping it would be closer to zero! : )
Thanks!
Jim