Overpayment of fixed rate KBC mortgage once transferred to BOI

[evil_g]

We have about 6 years left on a fixed term with KBC. At our current rate of overpayment we'll have overpaid by the maximum permitted by KBC towards the middle of next year.

Assuming that the mortgage has been transferred to BOI by that point, is it safe to assume that, even if BOI won't let us overpay beyond KBC's limit, they must permit us to break any portion of the mortgage we want (paying a break fee if applicable) to overpay that portion?

They can't insist that we either break the entire mortgage or none of it, can they?

Then, is it safe to assume that BOI will / must use the same cost of funds to calculate the break fee that KBC use? i.e. KBC's cost of funds at the time that we fixed? KBC won't tell us what this cost was, so there's not a lot of transparency in this area.

 

[Brendan Burgess]

1) I presume you have checked if there is a break-fee for paying more than the annual allowance?

2)

Assuming that the mortgage has been transferred to BOI by that point, is it safe to assume that, even if BOI won't let us overpay beyond KBC's limit, they must permit us to break any portion of the mortgage we want (paying a break fee if applicable) to overpay that portion?

Yes. They can't stop you overpaying your mortgage.

is it safe to assume that BOI will / must use the same cost of funds to calculate the break fee that KBC use?

A very good question. I have no idea.

Brendan

 

[evil_g]

1) I presume you have checked if there is a break-fee for paying more than the annual allowance?

2)

Yes. They can't stop you overpaying your mortgage.



A very good question. I have no idea.

Brendan

Thanks Brendan. Yes, I've been tracking the break fee myself using the guidance given here, and it's been zero for the last month or two, and I'd hope that'll remain the case.

It's possible that the more BOI's (and all banks') cost of funds increase, the more it'll be in their interests to permit us to overpay our relatively less profitable product.

Ideally I'd like to say to them "you can deal with the administrative costs of us calling up every six months to break and overpay by €3,000, with no penalty, or you could just let us continue overpaying by €500 per month". I'd hope that the latter solution would make more sense to them, but their systems might not permit it.