Moving house, BOI Tracker Question.

W

Warrenpaul

Registered User
Messages
15
Hi
Some impartial advise needed on the topic of moving house when currently fortunate enough to be on a tracker with BOI. Below is is my situation

€420,000 Current home valuation
€160,000 owed on 1.3% interest rate (€960 per month)
I am currently overpaying making payments of €1400 to lower the term and prove capacity to repay a higher sum if ever needed.

€260,000 equity if i was to sell the property today (in an ideal world).

Have our eye on a forthcoming development selling at €550,000

Crude figures i know but €290,000 of a new mortgage needed to secure the new house.
From the research i have found i can get the new mortgage plus 1% of the tracker rate on the balance owed at time of draw down and the remaining balance at a new business rate meaning:

€160,000 @ 2.3%
€130,000 @ 3.0%

My questions are:
1. Does this seem correct in anyone's experience of a similar situation ?
2. Would i be advised to bring the proposal to a bank i am not currently with ?
3. Would it ever be practice for the bank to consider a proposal of coming to a mutual agreement of say 2.6% for the full amount of the new mortgage.

Any advise would be great.
 
Just been through this with BOI

Will 3.5 x incomes allow for mortgage of €290k?

1. Correct
2. Then you lose the tracker - with that LTV you won't get as low as 2.3% anywhere else
3. No strictly on the amount outstanding

Additionally in stress testing they'll probably want you to take out a much longer term mortgage. And the way they work it is the tracker rate expires when your current term does and then rolls onto a variable rate. So your repayments for first few years may not be as high as you'd predict
 
@luckystar Thanks for the response.

Yes combined is enough to qualify for €297,500.

Perhaps id be better of paying the minimum repayment and having a longer term on my current mortgage allowing me keep the 2.3% for longer ?

I wouldn't mind the longer term, we are 35 & 32 so i would be ok with a 30 year term.
 
Stop overpaying your cheap tracker.

By overpaying it, you will end up with a lower mortgage to transfer to the new property at the tracker rate and you will have to borrow more at the higher rate.

Brendan
 
Warrenpaul said:
€160,000 @ 2.3%
€130,000 @ 3.0%
Click to expand...

Ulster Bank will give you the full €290k fixed for two years at 2.3% and €1,500 cash back.

Bank of Ireland will probably give you 2% cash back on the €130,000 which is €2,600.

The Ulster Bank deal seems better.

So, the best thing to do is
1) Get approval in principle from Ulster Bank when you are ready to buy
2)Confirm with BoI that they will give you 2% cash back on the €130,000
3) Ask BoI for a better rate than 3%
4) Buy your new house with a BoI mortgage
5) Switch to Ulster Bank as soon as you are settled in.

Tell your solicitor in advance what you are planning to do so that they will be ready for the second switch.

But it might be just simpler to switch to Ulster Bank.

Brendan
 
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