Switching with 3 children

D

Damuint

Registered User
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3 children under age of 7 and I can't seem to get past the affordability level. Do they all have different calculations or is it standard? Am I the only one that thinks this is absolute discrimination
 
They are probably all roughly similar, have you tried them all?

Don't see how it can be called discrimination, it's a fact that you have more outgoings than a person with no children and the more you have the more costs you have so less available to pay repayments. Same as married couple with only one working, is that discrimination that they can't borrow as much as where there are two incomes, of course not as two people need more to live on than one, it's unfortunate but is just maths.
 
Slightly different, but largely similar. The big difference in your case is that UB will consider children's allowance in their calculation. UB are also in the process of changing their normal retirement age to 66 if and extra year makes a difference to you.
 
Whilst it may not be discriminatory, it is certainly a ludicrous situation whereby if you are already paying your mortgage and could benefit from a lower rate by switching therefore reducing your monthly payments, surely you are then more able to afford the mortgage...?!
I am in the same situation whereby Danske are allowed to charge me 4.75% svr even though they've 'exited the country' and ive certainly tried to switch but even with LTV of 85% our current income vs outgoings ( 2 kids in childcare ) vs size of mortgage prhobits this. I could have saved approx €150 a month if AIB would have taken me but not to be.
Regardless of the governments mantra of switching the reality is that there are many thousands like me who have large mortgages that we continue to pay but could be paying less with a 'functioning' bank but simply cannot avail of lower rates. What is also very frustrating is that in Northern Ireland Danske are offering £2000 cashback to attract new customers and are a functioning bank there..!
 
Wow this is interesting and disappointing to hear.we bought in 2013 two incomes then now only 1 plus add 2 children under 4 and our 3rd to be born late November..
I'm was hoping to switch from robbing bank of Ireland next October when the fixed rate is up..out LTV will be under 50% then ..I could go KBC 10 year fixed at 2.95%or Aib 7 year fixed 3.3%..Boi is 3.8 % for 10 year fixed .it really disheartening that every other bank seem to be lowering their rates except Boi..why is this? Now from reading above seems like I won't b able to switch..its crazy..I'm being robbed at the moment at 3.6% when cud he getting it at 3%
 
eamo15 said:
Wow this is interesting and disappointing to hear.we bought in 2013 two incomes then now only 1 plus add 2 children under 4 and our 3rd to be born late November..
I'm was hoping to switch from robbing bank of Ireland next October when the fixed rate is up..out LTV will be under 50% then ..I could go KBC 10 year fixed at 2.95%or Aib 7 year fixed 3.3%..Boi is 3.8 % for 10 year fixed .it really disheartening that every other bank seem to be lowering their rates except Boi..why is this? Now from reading above seems like I won't b able to switch..its crazy..I'm being robbed at the moment at 3.6% when cud he getting it at 3%
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Robbing BoI? They have one of the most competitive short term fixed rates in the market. At <60% LTV you could get 3% fixed over 3 years or 3.2% over 5 years.
They were the first to issue 10 year fixed rates in June, and then KBC launched a much lower rate.

You should consider asking BoI what your break fee is on your current fixed rate and see if you'd be better off breaking out and re-fixing on one of their newer rates.
 
I spoke to boi yesterday re breaking my 3 yr fixed which I started April 2017. Cost was circa €500 for a loan of €540k at existing 3.15% fixed rate (was interested in Ulster bank 4 yr fixed rate at 2.6%). So the breakout fees for boi are very low - recommend giving them a call.
 
I think it's blatant discrimination against people with children. Yes children are a "cost" but not at the values set by banks. Adults already making repayments over an established period of time have already proven their repayment capacity. Does anyone know if this is a relatively new practice?
 
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Just the regular mortgage phone no for existing mortgages and ask for the break cost - they give you the settlement figure and then tell you what part of that is the break cost.
 
Damuint said:
Does anyone know if this is a relatively new practice?
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No it's not new, it was there for years before I left the bank and I'm gone 10 yrs. It didn't exist in the affordability rules initially which were usually once the higher plus half the lower income multiplied by 2.5 I think or 3, can't remember exactly. That then changed in later years to a net calculation of monthly salary where repayments could not exceed 35% of net monthly income with a minimum required to be left over to live on. This is where the dependents amount then came into play, it also applies to a stay at home spouse so if a single income earner with dependent partner or spouse there is an amount added in for them, is this discrimination against people with partners? Single people can borrow more than a person with a non working partner, again could that be called discrimination but I don't think it comes under the definition of discrimination.

Now maybe the figures need looking at, I don't have small children anymore so couldn't tell you if €200 a month is an excessive amount to allow for a child's costs?

I agree too that in the case of switching affordability should be looked at differently, it's the stress testing of repayments I would imagine that catch people at that stage where circumstances have changed from original application. Maybe there needs to be a new affordability calculation for switchers.

PS Actually the 'once higher and half lower' income rule which preceded the net calculation was a more crude version of allowing for cost of children too as it only applied to joint applicants as in 'couples' whereas say two brothers could borrow based on both their full salaries. It just obviously did not have a variable built in as to the number of dependants.
 
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