Switch to BOI or stay with UB?

Hi all, current UB situation situation detailed:

Current rate: 3.2% variable
Current LTV: 59%
Balance Outstanding: €258k approx
Haven: 2%
BOI: 1.9%
Been trying to switch to Haven since May, put in an application to BOI in July and got AIP from both Haven and BOI late sept. Decided to go with Haven, in the meantime BOI sent loan form to solicitor and we decided to wait for Haven. Today it transpires that Haven need more docs and instead of offering us a mortgage for 26 years as the AIP, they’re now offering for 31 years. We wanted the term as close as possible to 20 years.
I’m fed up with Haven, so spoke with broker about going with BOI, as much as I’d rather not as I don’t want to have to switch again. I cannot go through the application process with another lender, so my two (not so great) options are:
1.) Refix with UB @2.2% for 5 years
2.) Switch to BOI @1.9% for 4 years (20year mortgage offered) and overpay as much as possible to knock of another 2-3 years before the end of the fixed rate.
I’m not sure what to do but I’m leaning towards BOI. I have an account with them from 2002 and I doubt I’ll ever close it.
Will appreciate any thoughts. Thanks.

Why not go to AIB or Avant directly?

With a large mortgage and 20 years to go, it's well worth taking a long-term view and avoiding BoI which has predatory rates for existing borrowers which you will become after 4 years.

Brendan

I’m not sure I can go through the process again if I’m honest. I thought with Avant and Haven you had to go through a broker. In hindsight should have gone to AIB. Even if I were to put in an application the rates will rise before I get a decision. The application was submitted on the 6th of May that is excluding getting docs etc. Haven take ages to reply hence the BOI application in July. I cannot go through it again, it has consumed my life for the past couple of months. At least I can overpay as much as possible the allowed 10%.
To put it into context, our first mortgage in 2018 took 6 weeks for BOI and UB to approve and I submitted the application directly. To say this process has been stressful is an understatement.

@MsCutha Do you have any sense of how close you are to getting a full loan offer from either BOI or Haven?

Have you engaged the services of a solicitor? If so, have they requested your title deeds from UB?

You should call or email Ulster Bank for a break fee quote and a form to select a fixed rate – so that you have the form in case you decide to go that route:

@Paul F I paid the break fee and have been on their loyalty variable (3.2%) rate since June so no break fee. I have a full loan offer from BOI at Solicitor since Monday. We thought we’d wait for Haven but that all changed this afternoon. Solicitor has requested the title deeds from UB.
The rates are bound to go up soon, I’d rather take 1.9% and be done with it.

MsCutha said:

I have a full loan offer from BOI at Solicitor since Monday.

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Does the loan offer letter say anything like "This rate is valid for X days"?

Or does it say something like "Rates can change between now and drawdown"?

It says the rate cannot be guaranteed. I’ve attached a snip of the offer. Offer was made on 06 Oct.

MsCutha said:

It says the rate cannot be guaranteed.

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Thanks. We have seen that Avant, Finance Ireland and AIB have all given 4 week's grace to anyone who already had a full loan offer at the time of the rate increase. That's 4 week's from the date of the rate increase to draw down at the old rates. Hopefully Bank of Ireland feel compelled to offer this too – but there are no guarantees that they will.

Haven's rate is now 2.5% after today's rate increases. A 2.5% rate with Haven would cost you an extra €6,000 (approximately) over the next four years – versus BOI's 1.9% rate. But Haven will give you €2,000 cashback, so the difference is more like €4,000.

In four years' time we might expect Haven's rates to be lower than BOI's. (Remember that existing BOI customers aren't eligible for their "new business" rates or their 0.3% green discount.) But that's not certain either. Also, who's to say that Haven will even have issued you a loan offer before their next rate increase?

MsCutha said:

Solicitor has requested the title deeds from UB.

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Make sure your solicitor keeps chasing UB for the deeds – they are sometimes very slow. See this thread for approaches that work:

Your other option is to refix with UB:

• 5-year fixed at 2.2%
• 7- or 10-year fixed at 2.8%

Ulster Bank cap their break fees, so if you fixed on one of these rates now the maximum possible future break fee you would face, e.g., if you moved home, would be about €3,600. (It could of course be lower.)

You should call or email Ulster Bank to request a form to select a fixed rate – so that you have the form in case you decide to go that route:

Thanks so much for taking the time to reply. I will chase the deeds. I regret wasting so much time on Haven. Only yesterday my broker said the rates will go up soon and sure enough it has happened today. At least I have experience of switching and should know what to look for in the future as I will be switching in 4 years time. Just need to get this process over and focus on paying off as much as possible.

@MsCutha Bank of Ireland might put up their rates next week:

Paul F said:

Thanks. We have seen that Avant, Finance Ireland and AIB have all given 4 week's grace to anyone who already had a full loan offer at the time of the rate increase. That's 4 week's from the date of the rate increase to draw down at the old rates. Hopefully Bank of Ireland feel compelled to offer this too – but there are no guarantees that they will.

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If BOI don't give a grace period, e.g., 4 weeks, for you to complete the switch at the old rates, you will face the higher rates. If they do give a grace period, you will have a few weeks to get everything done.

That is worrying but not much that I can do. At least I have UB 2.2% to fall back on in the worst case scenario.

MsCutha said:

At least I have UB 2.2% to fall back on in the worst case scenario.

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That's only true if UB don't put up their rates in the meantime. That's why I suggested that you should call or email Ulster Bank to request a form to select a fixed rate – so that you have the form in case you decide to go that route:

The rates on the form remain valid for ten working days – i.e., having the form buys you two weeks' grace.

If I have to refix with UB, there is the facility to do it online as I’m on their variable rate.

MsCutha said:

If I have to refix with UB, there is the facility to do it online as I’m on their variable rate.

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A fair point but having the paper form will buy you two weeks' grace, which the online facility won't.

Thanks, I have called them and requested the form but was told to do it online.
We signed the loan offer and went to the Solicitor to sign the associated paperwork. He’s hoping it will be done and dusted in two weeks