Hi Earl what I was afraid of was the 20% variable element of it as BOI are one of the highest rates and also perhaps not being able to switch in two years time after the fixed expired for any given reason. After researching into things a little I can reduce the variable to 10% as I can pay back 10% of the fixed early to KBC without any fees.If the deal still makes sense for you, then go ahead.
If the homeloan is sold to Bank of Ireland, they'll have to honour the contractual terms.
That sounds great, thanks for that I had not thought of doing things that way.It's a balancing act between locking in the best rates available now, ensuring flexibility too clear the mortgage sooner rather than later while also protecting yourself against potential rate increases.
The BOI angle is a variation on when will rates rise in the future.
How certain are you that you will be able to over pay in the future?
If you're unsure if will happen why not fix the whole lot and take your chances with break fees. Keeping a portion it variable is costing you anywhere between 0.7%-1% on that portion - depending on your LTV.
If it's more or less guaranteed might you be better off splitting your mortgage across fixed rate buckets. For example fixing 10% for 1 year rather than keeping it variable would save you anywhere between .5%-.8% on that portion and you would have the flexibility to overpay it at the end of year 1 and still have the flexibility to overpay 10% of the remaining balance without a break fee.
If you're really concerned about the BOI effect why not take advantage of the various fixed rate buckets. The soon would be to have it set up so whatever rolled off a fixed would be equivalent to what you know you will have in spare funds.
Don't forget you can repay 10% of the initial balance through the fixed period before a break fee is calculated. Do you really need to split it into 3?3 different rates would be even better than two...
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