@Craig_David This is almost certainly incorrect. Can you check all your mortgage details again?
@Craig_David This is almost certainly incorrect. Can you check all your mortgage details again?Your current mortgage interest rate : 2.1%
Thanks @Paul FMake sure you understand the very generous tax break you get by contributing to a pension.
Correct.
You will receive a confirmation letter but you will not be put on the variable rate – you will remain on the 2.15% fixed rate.
Correct. There is a slight risk that AIB could put up their rates between the time you send the form and the time they process it. If that worries you, don't send the amendment form.
Not sure.
If you want to stay on the 2.15% rate you don't need to do anything after making the overpayment.Everything is clear now except the point 4 regarding the Amendment Form. If I am going to stay on 2.15% fixed rate, then why am I completing the Amendment Form? There is a risk as you mentioned that rate may go up.
@Flapjack Your break fee should be zero at the moment – but it is volatile because wholesale interest rates are volatile, so confirm it with EBS. If it is higher than zero, please post it here when you receive it, including the date of the letter.
- Current lender: EBS
- Outstanding mortgage balance (how much you still owe) 398,000
- Approximate current value of your property 510,000
- The date you started your fixed-rate mortgage (month and year) April 2022
- How many years you fixed for: 2
- Your current mortgage interest rate 2.75%
- Your current monthly repayment (excluding any overpayments) €1632
- Your property's BER (Building Energy Rating) – check it here or estimate it if necessary B3- recently got work done & improved it to this
- Are you due to get extra cashback from your current lender in the future, e.g., "1% after 5 years", or "2% cashback monthly"? If so, how much (monetary amount) and when? Yes 1% April 2027 €4000
You should be able to do this and the break fee should be zero but check it with EBS. You will need a BER cert with a rating of B3 or better, and this cost is not included in the above estimates.Can I break the 2.75% rate to move to EBS 2.1% Green Rate as my BER is now B3. Would there be a break fee?
Overpaying your mortgage/reducing your balance may not be the best use of your money. Your priorities should usually be:I also took a higher mortgage amount to get more cashback & as we were carrying out work we released some equity from previous home when selling/buying- didn't need all of this, have 90,000 surplus in account - I was thinking of paying this off the mortgage also if I break and hopefully refix.
Thank you so much , fantastic advice & information. Hugely appreciated@Flapjack Your break fee should be zero at the moment – but it is volatile because wholesale interest rates are volatile, so confirm it with EBS. If it is higher than zero, please post it here when you receive it, including the date of the letter.
- Switching immediately to Haven's 4-year green fixed rate (2.0% with €2,000 cashback) will save you about €6,500 over the next 4 years
- Switching immediately to EBS's 4-year green fixed rate (2.1% with no cashback) will save you about €4,420 over the next 4 years. And it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
- Warning: EBS may argue that by switching to this rate you become ineligible for the 1% cashback in the future. But there is nothing in the terms and conditions that allows them to deny you the cashback – see this thread. You may have to make this argument to EBS, or even to the Ombudsman, in order to get the cashback, however.
- Switching immediately to Haven's 7-year fixed rate (2.65% with €5,000 cashback) will leave you worse off by about €520 over the next 4 years – but with the longer security of 7 years on a fixed rate
- Switching immediately to Haven's 10-year fixed rate (2.85% with €5,000 cashback) will leave you worse off by about €3,620 over the next 4 years – but with the longer security of 10 years on a fixed rate
- Switching immediately to Finance Ireland's 10- or 15-year fixed rate (3.15% with no cashback) will leave you worse off by about €13,320 over the next 4 years – but with the longer security of 10 or 15 years on a fixed rate
- This product has a benefit in relation to moving home in the future that is explained below
- And your interest rate (initially 3.15%) will fall to 3.05% in 4 years and 9 months when you move into a lower loan-to-value bracket (or sooner if you make overpayments or your property increases in value and you get an updated valuation). See the section "How we decide rate reductions" on this page.
- And your interest rate will fall again in the future
- Switching immediately to Finance Ireland's 20-year fixed rate (3.25% with no cashback) will leave you worse off by about €14,880 over the next 4 years – but with the longer security of 20 years on a fixed rate
- This product has a benefit in relation to moving home in the future that is explained below
- And your interest rate (initially 3.25%) will fall to 3.15% in 4 years and 10 months when you move into a lower loan-to-value bracket (or sooner if you make overpayments or your property increases in value and you get an updated valuation). See the section "How we decide rate reductions" on this page.
- And your interest rate will fall again in the future
- Switching immediately to Finance Ireland's 25-year fixed rate (3.4% with no cashback) will leave you worse off by about €17,220 over the next 4 years – but with the longer security of 25 years on a fixed rate
- This product has a benefit in relation to moving home in the future that is explained below
- And your interest rate (initially 3.4%) will fall to 3.3% in 4 years and 11 months when you move into a lower loan-to-value bracket (or sooner if you make overpayments or your property increases in value and you get an updated valuation). See the section "How we decide rate reductions" on this page.
- And your interest rate will fall again in the future
These savings estimates use for comparison the scenario of switching to the 2.1% rate with EBS when the current fixed rate ends. And that's assuming that EBS are even offering a 2.1% rate in April 2024 – it could be higher (or lower). The estimates also account for any fees (solicitors' fees, valuation fee) that you have to pay and any cashback offered by the above lenders.
Finance Ireland's 10-year and longer fixed rates allow you to avoid any potential break fee if you move home in the future (as long as you take out a new mortgage with them, and subject to certain conditions). And you can "take your mortgage with you" – meaning that you get to keep the same interest rate when you move (provided that at least 3 years have passed since you started the Finance Ireland fixed rate and subject to certain other conditions).
The estimates also assume that your loan-to-value ratio (LTV) really is below 80% so that you are eligible for the listed rates. Your LTV estimate is 398.0k/510.0k = 78.0%. If you get a valuation of less than €498k, you will need to make a few more monthly mortgage payments and/or a lump sum overpayment to get the LTV below 80%. But that is not a reason to delay the switch – i.e., you can start the switch immediately.
If you're feeling brave, you could consider the strategy outlined in this thread: switch to Haven's 2.35% 3-year fixed rate and get the €5k cashback. Then quickly switch to Haven's 2.0% green rate. If it works, you will be better off by about €9,500 in four years' time. Nobody knows for sure if Haven will allow you to do this, so you might be stuck on the 2.35% rate, but at least you'd have got the €5k cashback.
I have also shown rates for Haven and Finance Ireland but it is not certain that they will let you switch to them (since you have had a mortgage with your current lender for such a short time). See this thread for more details.
Bear in mind that interest rates could rise between now and the time that you complete any switch, so if you are thinking of switching you should apply simultaneously to two or more lenders for approval in principle (AIP).
You should be able to do this and the break fee should be zero but check it with EBS. You will need a BER cert with a rating of B3 or better, and this cost is not included in the above estimates.
Note my above warning that EBS may try to deny you the 1% (€4,000) cashback in April 2027.
Overpaying your mortgage/reducing your balance may not be the best use of your money. Your priorities should usually be:
in approximately that order. Consider posting a thread about your situation in the Money Makeover forum.
- Paying off expensive debt (credit cards, personal loans, car loans, etc.)
- Building up an emergency fund in a savings/current account (3 to 6 months' living expenses)
- Saving money for any expenses you will have over the next few years (kids; childcare; adult children going to college, etc.)
- Maxing out your pension contributions (very large tax relief is given)
- Overpaying your mortgage
@Craig_David Your break fee should still be zero at the moment.
- KBC (Current Mortgage)
- Outstanding mortgage balance : 240k
- Approximate current value of your property : 350k
- The date you started your fixed-rate mortgage (month and year) : July 2021
- How many years you fixed for : 3 years
- Your current mortgage interest rate :
2.1%[I will assume that the rate is actually 2.3%]- Your current monthly repayment (excluding any overpayments) : € 973.25
- Your property's BER (Building Energy Rating) – B3 (cert expired in February 2022)
- Are you due to get extra cashback from your current lender in the future : NO
You can see from the above estimates that BOI is not a good choice in your circumstances (unless you are very far along in the process of switching to them).I'm currently looking to switch from KBC to BOI.
No, it is not possible to do what you are suggesting. But in your case it is very unlikely that the break fee will go above zero for the foreseeable future.I understand its possible that a month from now for example, the breakage fee could be actually something very different to zero.
Can I sign the breakage document to be effective from a certain date or how best do I go about maintaining the zero breakage fee, but also delaying the actual breakage date to coincide with the switch?
Yes, if you want to switch to a green rate. The above savings estimates don't account for the cost of getting a new cert.On a side note, I see my BER cert expired this year. Presumably I will need to get an updated cert for the switch?
thanks a lot for that. Sorry for the delay. Yes you are correct. 2.3% is the rate.@Craig_David Your break fee should still be zero at the moment.
- Switching immediately to Haven's 4-year green fixed rate (2.0% with €2,000 cashback) will save you about €4,060 over the next 3 years
- Switching immediately to AIB's 5-year green fixed rate (2.15% with €2,000 cashback) will save you about €3,000 over the next 3 years
- And it is quite likely that you will be able to make unlimited overpayments without penalty for the foreseeable future (see this thread)
- Switching immediately to Bank of Ireland's 3- or 5-year green fixed rate (2.7% with €4,800 cashback) will save you about €1,940 over the next 3 years
- Note that Bank of Ireland discriminate between new and existing customers, i.e., their best rates are not available to existing customers
- For example, if you were an existing Bank of Ireland customer, the best rate you would be able to switch to today is 3.0%
- So if you switch to them now, you will not be eligible to switch to one of their low rates in the future and you will end up on a higher interest rate. When that happens, you may want to switch again to another lender, which will incur costs (and it might be impossible to switch if your financial situation has deteriorated).
- Switching immediately to Avant Money's 4-year fixed rate (2.05% with no cashback) will save you about €1,680 over the next 3 years
- Re-fixing immediately on KBC's 3-year fixed rate (2.3% with no cashback) will save you about €1,260 over the next 3 years, and it will "reset the clock" on the fixed-rate period. And it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
- Note that if you decide to do this, your mortgage will soon move onto Bank of Ireland's books
- The same warnings as above regarding higher Bank of Ireland rates in the future apply
- Switching immediately to Avant Money's 5-year fixed rate (2.25% with no cashback) will save you about €280 over the next 3 years
- Switching immediately to KBC's 5-year fixed rate (2.45% with no cashback) will save you about €200 over the next 3 years. And it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
- Note that if you decide to do this, your mortgage will soon move onto Bank of Ireland's books
- The same warnings as above regarding higher Bank of Ireland rates in the future apply
- Switching immediately to Avant Money's 7-year fixed rate (2.35% with no cashback) will leave you worse off by about €420 over the next 3 years – but with the longer security of 7 years on a fixed rate
- If Avant won't let you switch to them and you really want to fix for 7 years for some reason, you could consider Haven's 7-year fixed rate (2.65% with €2,000 cashback)
- Switching immediately to Avant Money's 10-year fixed rate (2.5% with no cashback) will leave you worse off by about €1,480 over the next 3 years – but with the longer security of 10 years on a fixed rate
- If Avant won't let you switch to them and you really want to fix for 10 years for some reason, you could consider Haven's 10-year fixed rate (2.85% with €2,000 cashback)
- Switching immediately to Avant Money's "One Mortgage" (a 2.65% fixed rate with no cashback) will leave you worse off by about €2,540 over the next 3 years – and the interest rate will remain fixed for the remainder of your mortgage term (approximately 28 years)
- Switching immediately to KBC's 10-year fixed rate (2.99% with no cashback) will leave you worse off by about €3,600 over the next 3 years – but with the longer security of 10 years on a fixed rate. And it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
- Note that if you decide to do this, your mortgage will soon move onto Bank of Ireland's books
- The same warnings as above regarding higher Bank of Ireland rates in the future apply
- Switching immediately to Finance Ireland's 10- or 15-year fixed rate (3.05% with no cashback) will leave you worse off by about €5,360 over the next 3 years – but with the longer security of 10 or 15 years on a fixed rate
- This product has a benefit in relation to moving home in the future that is explained below
- And your interest rate (initially 3.05%) will fall to 2.9% in 5 years and 1 month when you move into a lower loan-to-value bracket (or sooner if you make overpayments or your property increases in value and you get an updated valuation). See the section "How we decide rate reductions" on this page.
- Switching immediately to Finance Ireland's 20-year fixed rate (3.15% with no cashback) will leave you worse off by about €6,060 over the next 3 years – but with the longer security of 20 years on a fixed rate
- This product has a benefit in relation to moving home in the future that is explained below
- And your interest rate (initially 3.15%) will fall to 3.0% in 5 years and 2 months when you move into a lower loan-to-value bracket (or sooner if you make overpayments or your property increases in value and you get an updated valuation). See the section "How we decide rate reductions" on this page.
- Switching immediately to Finance Ireland's 25-year fixed rate (3.3% with no cashback) will leave you worse off by about €7,120 over the next 3 years – but with the longer security of 25 years on a fixed rate
- This product has a benefit in relation to moving home in the future that is explained below
- And your interest rate (initially 3.3%) will fall to 3.15% in 5 years and 3 months when you move into a lower loan-to-value bracket (or sooner if you make overpayments or your property increases in value and you get an updated valuation). See the section "How we decide rate reductions" on this page.
These savings estimates use for comparison the scenario of switching to the 2.9% rate with Bank of Ireland (who will probably own your mortgage) when the current fixed rate ends. And that's assuming that Bank of Ireland are even offering a 2.9% rate in July 2024 – it could be higher (or lower). The estimates also account for any fees (solicitors' fees, valuation fee) that you have to pay and any cashback offered by the above lenders.
All of Avant's rates, and Finance Ireland's 10-year and longer fixed rates, allow you to avoid any potential break fee if you move home in the future (as long as you take out a new mortgage with them, and subject to certain conditions). And in the case of Finance Ireland you can "take your mortgage with you" – meaning that you get to keep the same interest rate when you move (provided that at least 3 years have passed since you started the Finance Ireland fixed rate and subject to certain other conditions).
The estimates also assume that your loan-to-value ratio (LTV) really is below 70% in order to be eligible for Avant rates listed above. (You are already eligible, from an LTV perspective, for the other listed rates.) Your LTV estimate is 240.0k/350.0k = 68.6%. If you get a valuation of less than €343k, you will need to make a few more monthly mortgage payments and/or a lump sum overpayment to get the LTV below 70%. But that is not a reason to delay the switch – i.e., you can start the switch immediately.
Bear in mind that interest rates could rise between now and the time that you complete any switch, so if you are thinking of switching you should apply simultaneously to two or more lenders for approval in principle (AIP).
You can see from the above estimates that BOI is not a good choice in your circumstances (unless you are very far along in the process of switching to them).
No, it is not possible to do what you are suggesting. But in your case it is very unlikely that the break fee will go above zero for the foreseeable future.
Yes, if you want to switch to a green rate. The above savings estimates don't account for the cost of getting a new cert.
Some lenders might let you use your old BER cert since it is only slightly out of date – ask them. If not, you will need a new one, and because your BER was marginal (B3) on the last cert there is no guarantee that you will get a B3 rating this time. Then you would only be eligible for BOI's non-green rate (3.0%) – another reason to avoid them.
Yes, existing KBC customers can still switch to a different rate. You can see the 10-year and shorter fixed rates here, under the "Fixed Rate – 0.2% Current Account Discount" section.Are KBC still offering mortgage applications? I don't see any mention of a 10 year fixed rate on their site either.
@Betelgeuse Your break fee should be zero at the moment – but it is volatile because wholesale interest rates are volatile, so confirm it with Ulster Bank. If it is higher than zero, please post it here when you receive it, including the date of the letter.
- Current lender Ulster Bank
- Outstanding mortgage balance (how much you still owe) €269,201.27
- Approximate current value of your property €507,956
- The date you started your fixed-rate mortgage (month and year) 31/03/2019
- How many years you fixed for 4 (31/03/2023)
- Your current mortgage interest rate 2.6%
- Your current monthly repayment (excluding any overpayments) €1,260.78
- Your property's BER (Building Energy Rating) – check it here or estimate it if necessary A2
- Are you due to get extra cashback from your current lender in the future, e.g., "1% after 5 years", or "2% cashback monthly"? If so, how much (monetary amount) and when? No
Note: you may receive two separate letters from Ulster Bank a few days apart, and their structure and wording can lead to confusion. Look for the line that says: "To break out of this fixed rate early, you would have to pay a fee of €X". That amount is your break fee. Ignore all other references to break fees.
@Mail2017 Your break fee should be zero at the moment – but it is volatile because wholesale interest rates are volatile, so confirm it with KBC (and please post it here when you receive it, including the date of the letter).
- Switching immediately to Permanent TSB's 5-year green fixed rate (2.35% with €6,640 initial cashback and 2% monthly cashback) will save you about €6,160 over the next 4 years
- Note that Permanent TSB discriminate between new and existing customers, i.e., their best rates are not available to existing customers
- For example, if you were an existing Permanent TSB customer, the best rate you would be able to switch to today is 2.95%
- So if you switch to them now, you will not be eligible to switch to one of their low rates in the future and you will end up on a higher interest rate. When that happens, you may want to switch again to another lender, which will incur costs (and it might be impossible to switch if your financial situation has deteriorated).
- Switching immediately to Haven's 4-year green fixed rate (2.0% with €2,000 cashback) will save you about €5,140 over the next 4 years
- Switching immediately to AIB's 5-year green fixed rate (2.15% with €2,000 cashback) will save you about €3,200 over the next 4 years
- And it is quite likely that you will be able to make unlimited overpayments without penalty for the foreseeable future (see this thread)
- Switching immediately to Avant Money's 7-year fixed rate (2.05% with no cashback) will save you about €2,460 over the next 4 years – but with the longer security of 7 years on a fixed rate
- You would have to shorten your mortgage term to 30 years to be eligible for this rate
- The monthly repayment would be €1,235
- Switching immediately to Avant Money's 10-year fixed rate (2.2% with no cashback) will save you about €520 over the next 4 years – but with the even-longer security of 10 years on a fixed rate
- You would have to shorten your mortgage term to 30 years to be eligible for this rate
- The monthly repayment would be €1,261
- Switching immediately to KBC's 5-year fixed rate (2.45% with no cashback) will leave you worse off by about €1,360 over the next 4 years. But it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
- Note that if you decide to do this, your mortgage move will soon move onto Bank of Ireland's books, and they discriminate between new and existing customers, i.e., their best rates are not available to existing customers
- For example, if you were an existing Bank of Ireland customer, the best rate you would be able to switch to today is 3%
- So if you switch to this KBC offer now, you will not be eligible to switch to one of Bank of Ireland's low rates in the future and you will end up on a higher interest rate. When that happens, you may want to switch again to another lender, which will incur costs (and it might be impossible to switch if your financial situation has deteriorated).
- Switching immediately to Finance Ireland's 10- or 15-year fixed rate (2.55% with no cashback) will leave you worse off by about €4,000 over the next 4 years – but with the even-longer security of 10 or 15 years on a fixed rate
- This product has a benefit in relation to moving home in the future that is explained below
- And your interest rate (initially 2.55%) will automatically fall as time passes and you move into lower loan-to-value (LTV) brackets. See the section "How we decide rate reductions" on this page.
These savings estimates use for comparison the scenario of switching to the 2.30% rate with KBC when the current fixed rate ends. And that's assuming that KBC (or Bank of Ireland, if they have taken over your mortgage by then) are even offering a 2.30% rate in December 2022 – it could be higher (or lower). The estimates also account for any fees (solicitors' fees, valuation fee) that you have to pay and any cashback offered by the above lenders.
All of Avant's rates, and Finance Ireland's 10-year and longer fixed rates, allow you to avoid any potential break fee if you move home in the future (as long as you take out a new mortgage with them, and subject to certain conditions). And in the case of Finance Ireland you can "take your mortgage with you" – meaning that you get to keep the same interest rate when you move (again, subject to certain conditions).
The Avant and Finance Ireland estimates also assume that you get your loan-to-value ratio (LTV) below 70% so that you are eligible for their listed rates. Your LTV is currently 332k/460k = 72.2%. A slightly higher property valuation (€475k) and/or a few more monthly mortgage payments and/or a small overpayment will get you below 70%. Your LTV is already low enough for the other rates listed.
If you're feeling brave, you could consider the strategy outlined in this thread: switch to Haven's 2.35% 3-year fixed rate and get the €5k cashback. Then quickly switch to Haven's 2.0% green rate. If it works, you will be better off by about €8,140 in four years' time. Nobody knows for sure if Haven will allow you to do this, so you might be stuck on the 2.35% rate, but at least you'd have got the €5k cashback.
If you want savings estimates for longer-term fixed rates, let me know.
@ConorPM I'm not seeing a 2.8% rate from BOI, now or last year. Can you check all your mortgage details again?
- The date you started your fixed-rate mortgage (month and year) February 2021
- How many years you fixed for: 4
- Your current mortgage interest rate 2.8%
Hi Paul, I've checked again and the rate is 2.8%. Our initial offer letter was in October 2019 and it's a green mortgage. It was drawn down in stages (self build mortgage) and the final drawdown was February 2021 so that's why I have February 2021 down as the date the fixed-rate mortgage started, however I might not be right about that. I'm not actually sure when the fixed rate period (which is actually 5 years, I have 4 above) commenced, I'll need to check with the bank. Apologies for the confusion.@ConorPM I'm not seeing a 2.8% rate from BOI, now or last year. Can you check all your mortgage details again?
@ConorPM Your break fee should be zero at the moment – but it is volatile because wholesale interest rates are volatile, so confirm it with Bank of Ireland. If it is higher than zero, please post it here when you receive it, including the date of the letter.
- Current lender: Bank of Ireland
- Outstanding mortgage balance (how much you still owe) 365,710
- Approximate current value of your property 550,000
- The date you started your fixed-rate mortgage (month and year) February 2021
- How many years you fixed for: [Actually 5]
- Your current mortgage interest rate 2.8%
- Your current monthly repayment (excluding any overpayments) €1600
- Your property's BER (Building Energy Rating) – check it here or estimate it if necessary: A2
- Are you due to get extra cashback from your current lender in the future, e.g., "1% after 5 years", or "2% cashback monthly"? If so, how much (monetary amount) and when? Yes 1% after 5 years, 3,840 euros
@apintofplain Are you sure that 4.25% is your current rate with KBC? Their website is showing 4.5% as their variable rate for buy-to-lets.Some info, was a first time buyer but moved out of the property and changed to a buy to let mortgage.
- Current lender : KBC
- Outstanding mortgage balance : €173,755.78
- Approximate current value of your property : €370,000
- The date you started your fixed-rate mortgage (month and year) : On variable rate
- How many years you fixed for : N/A
- Your current mortgage interest rate : 4.25% (KBC variable rate, buy to let mortgage)
- Your current monthly repayment : €1390
- Your property's BER (Building Energy Rating) – D1 (estimate)
- Are you due to get extra cashback from your current lender in the future : No