Should we re-fix with KBC at 2.4% or switch to another lender?

J

Julian

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Looking for advice as to whether we should re-fix with KBC or move to another lender such as PTSB.

We're just over 4 years into a 5-year fixed rate period with KBC at 2.6%. Mortgage balance is ~270k with 17 years remaining. LTV is below 50% and our BER is A3.

A breakage fee no longer applies so we can end our fixed rate at no charge.

KBC are offering us a new 5-year fixed rate at 2.4%. BoI are obliged to honour that rate once they take over KBC's mortgage book in early 2023.

My question is, is 2.4% for 5 years competitive or is it worth going through the hassle of switching to get a lower rate? Looks like we could fix with e.g. PTSB at 2.05% for the same period, though we haven't switched before so not sure how much hassle/expense is involved.

Any advice appreciated!
 
@Julian You probably realise this but just to say that you are also eligible for KBC's 10-year fixed rate (2.85%).

The security of a longer period on a known (albeit higher) rate might appeal to you, but if you were to move home in the next few years you could potentially face a very large break fee.
 
Many thanks for the replies, that's very helpful.

@Paul F I wasn't actually aware of the 10-year rate as I haven't considered fixing for any longer than 5 years. We've no intention of moving again but that rate seems a little high (although of course it's impossible to know where rates will be in 5+ years' time).

I should mention that KBC have also offered us a 2- or 3-year fixed rate at 2.25%.
 
Julian said:
KBC have also offered us a 2- or 3-year fixed rate at 2.25%.
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You should not avail of this. You will be subject to Bank of Ireland's predatory rates when the fixed rate ends, so a longer fixed rate is better. 5 years seems right.

But as Paul suggests, don't dither over it. Fix today whichever one you go for.

Brendan
 
Many thanks @Brendan Burgess, will fix today.

We're also going to lock in our monthly overpayments by reducing our remaining term. Annoyingly, KBC's "flexible option" only applies overpayments for 12 months before reducing your payments again. We can afford to shave a few years off our term by keeping our payments up at ~2k per month.
 
Brendan Burgess said:
And people should be switching away from ptsb and Bank of Ireland, and not moving to them.
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Even for the BoI "Green" mortgage? They're offering us fixed rates of 1.9% for 4 years, 2.2% for 5 years and 2.25% for 7 years. Those rates are for new business only though and won't be available once our mortgage is moved over to them.
 
Julian said:
Those rates are for new business only though and won't be available once our mortgage is moved over to them.
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I suppose you could take the risk and fix for 7 years at 2.25%

However, you are taking the added risk that the rates will have gone up by the time you switch.

Brendan
 
Julian said:
Many thanks @Brendan Burgess, will fix today.

We're also going to lock in our monthly overpayments by reducing our remaining term. Annoyingly, KBC's "flexible option" only applies overpayments for 12 months before reducing your payments again. We can afford to shave a few years off our term by keeping our payments up at ~2k per month.
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Same situation as us. I fixed for 5 years with KBC at same rate. Also overpaying to reduce term for the 12 months before reviewing again.
 
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