Split Mortgage - Can we switch lender?

[Sir Iowealot]

Hi everyone, I was just wondering if anyone has been able to switch lender with a split mortgage. We have spent the last number of years clearing all our short term lending car,cu, cards etc.. without going to the ISI for debt relief. As they are all repaid we now have increased income but not enough to make the lump sum payments off the split required to avail of the 30% discount given by the bank in the first 5 years.

Was thinking that if we could switch the mortgage we would get the 30% discount off the split and have it cleared. However, I assume we would have to go back into a SVR for all the money and depending on the rate the savings could be eaten up in additional interest over the remaining term of the loan. Any suggestions would be welcome as I am probably asking too much in getting an economic concession from another lender. A lower rate would still be better our LTV is about 58%. Thanks

 

[Sarenco]

I don't mean to sound overly harsh but why do you think any lender in their right mind would want to refinance your restructured home loan?

Put yourself in a loan officer's shoes for a minute - would you approve the loan?

 

[Sir Iowealot]

Hi Sarenco, Not harsh but don't think it is a fair point either. I have repaid all my debts under arrangements without relief (excluding my mortgage) and have been paying my mortgage without fail for nearly 3 years do you not think I have proven my "ability to repay" after some very serious life changing circumstances which were out of my control.

Surely a loan officer would base it on my current circumstances and the fact that NONE of my short term creditors were "burned" by me. If that is the case I was a fool to pay all my bills and should simply have gone on holidays every year without thinking about any of them if as you say I am stuck with what I now have.

 

[Gordon Gekko]

Sarenco is right; in my view, every mainstream lender's computer system will explode when your credit history is inputted.

However, Pepper might look at your case.

 

[Brendan Burgess]

I have repaid all my debts under arrangements without relief (excluding my mortgage)

You can't just exclude your mortgage.

Certainly any lender to whom you applied for a loan would not do so.

How much was warehoused? When is the 5 years up? Have you any friends or family who might lend you money so that you could avail of this 30% discount?

 

[Sir Iowealot]

Sorry Brendan, I meant that it was the only one I got some concession on as opposed to excluding it from the credit assessment.

18 mths left before that offer expires and 100K is the split amount before the discount.

I regret that I have no relatives or friends who would be in a position to help me out with it.

 

[Brendan Burgess]

Hello Sir

This is a very important issue and will affect other people. I have addressed the issues systematically in this new Key Post.

How much discount should I get for early redemption of a warehoused mortgage?


You will see that I conclude that even if you could refinance it, you should not do so. I would prefer a €100k interest free loan over 20 years than a €70,000 loan at 4% over 20 years.

Brendan