Offset mortgages - available in Ireland

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dublin67

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Is anyone aware if this product is available in Ireland?

The general idea is that you have funds on deposit either in a current account or an interest account with the bank that you also have a mortgage with. The principal on which the interest is calculated is your net balance - the mortgage amount less the amount in your savings interest account.

The obvious advantage is that you pay interest on lower capital amounts while keeping your saved funds available - i.e. it isn't treated like a mortgage repayment. I know that NIB/Dankse had a type of offset available (obviously gone now) and such products are available in the UK.
 
No, they don't currently exist.

There was an option with KBC where you could overpay the mortgage, and later redraw the funds, but I understand they gave removed this option for the customers that had it.
 
Don't think anyone has them anymore. First Active launched them years ago, PTSB and National Irish had a variation of it at the time but don't know of any other fully fledged offset similar to the FA one which I still have, great product!
 
I have just spoken to KBC, they are still offering offset mortgages to current variable accounts.

I think it makes total sense with current low interest rates.

I was surprised they are offering it and why more people are not availing of it?

Put in a lump sum (if you can afford to) & take out with 7 days notice
 
desmondo said:
I have just spoken to KBC, they are still offering offset mortgages to current variable accounts.

I think it makes total sense with current low interest rates.

I was surprised they are offering it and why more people are not availing of it?

Put in a lump sum (if you can afford to) & take out with 7 days notice
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Excellent and thank you very much. By a fluke I'm currently moving my mortgage to KBC.
 
I want to overpay my mortgage, drew down my mortgage in Dec 2015, got form that I can redraw money back today, if you have say 12k, do 4 months of 3k, if you can’t do lump repayments

Will that work? (Appears to be good deal
 
As the original OP on the referenced thread, my understanding from KBC is this facility is no longer available if you drew down your mortgage after September 2013. The Flexible Repayment Instruction form states "The funds will be available to redraw at a later date subject to KBC Homeloans Terms and Conditions." If there is no reference to the ability to redraw in your T&C's, then it is safe to assume this would not be permitted. If you have a mortgage from before September 2013, the facility is still available to my knowledge, but worth checking with the bank.
Note, this applies to both lump sum payments and regular over-payments.

So @desmondo in short, I don't believe what you are proposing will work and its likely if you check with KBC you will be told the same thing.

desmondo said:
I have just spoken to KBC, they are still offering offset mortgages to current variable accounts.
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I have to admit I am amazed with this comment. Who did you speak to with KBC and have you asked them to send you this in writing? Was it some staff member in a call centre or someone in a management role with responsibility over mortgages? Are they sure they are not talking about the 0.2% discount when you have a current account with them. Are you sure they understand what an offset mortgage is and did you ask if there was any pre-conditions to it ?
The reason I am saying this is I went through an internal dispute with KBC on the issue in 2016. We eventually came to an agreement and as part of a different FSO dispute which was only resolved before Christmas 2017, I had the redraw option included in the FSO mediation agreement. During these lengthy conversations, I was repeatedly told that the redraw option was not available and was not in the pipeline for re-introduction. These discussions are only 1-2 months old, and was with specialists within KBC in their respective areas.
 
@dublin67 If you are planning to use this facility, I would get a clear written instruction from KBC that you are permitted to do so. If this is a deal breaker for you, I would ensure it is clearly written into your mortgage T&C's under special conditions if you are in a position to do so.
 
One final comment on this - in my view this is a fantastic facility to have on a mortgage and even if it was to be capped at 10%-25% the value of the mortgage, it would be a unique selling point for any "innovative" mortgage product in Ireland.

I fought very hard to maintain mine with KBC and once secured it effectively meant I was never going to move from KBC. Despite all my disagreements with them over the years, I have now signed up for a 10 year fixed rate - so pretty much committing the remainder of my mortgage term with them.
 
Thanks gnf ireland for your reply, i did speak to two different reps in a call centre and asked them to confirm with their supervisor. I thought it was too good to be true. I will get back onto them today ask for specific confirmation (in writing) that my mortgage T&C's allow me redraw funds. They were both adamant that it was allowed. The plot thickens..... This would really work well for me.....
 
Thank you for all the comments. I will see if I can get this with KBC and I'll let you know -from the above it will be unlikely but we'll see.
 
desmondo said:
i did speak to two different reps in a call centre and asked them to confirm with their supervisor. I thought it was too good to be true. I will get back onto them today ask for specific confirmation (in writing) that my mortgage T&C's allow me redraw funds. They were both adamant that it was allowed.
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To be honest, I know we should all be able to go on what we are told by a call centre, but there can be a challenge in proving this discussion if it is not in writing. Very few organisations call record all transactions, and even then tend to only hold them for a very short window (~3 months), and are using for Quality and Training purposes. Add new GDPR rules in here, and this will make it more difficult for companies to keep customer data such as this.

I would write a letter to them, outlining the dates of your calls to the call centre and stating that you are proceeding on this basis. Clearly state your understanding, and ask them to confirm such as you are making financial decisions based on the responses you have received. Give them a deadline for acknowledgement/response of say 2-3 weeks. Keep a copy of the letter (obviously).

That way you are telling them in advance what you are doing and you are trusting the information you received from the call centre.


dublin67 said:
I will see if I can get this with KBC and I'll let you know
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Do you have the T&C's for your mortgage application yet? Are you going through a broker or directly? Ask them in writing about redraw options - so give a scenario - I overpay by 20,000 euro and I have an emergency whereby I need to purchase a new car. Can I redraw the overpaid funds and if so, what are any pre-conditions around it. If you get an answer verbally, follow up with a written response clearly stating your understanding of what they have told you.
You are in a difference scenario as you are not a mortgage customer of KBC yet and therefore you can try and influence the T&C now you know about it in advance. If they say no, ask if it can be a special condition of your mortgage, even if the detail is capped at say 20k or whatever.
Very little point having this discussion with them after it has been signed
 
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