The length of the Term is stalling me.. 32 v 30 years

Discussion in 'Mortgages and buying and selling homes' started by BusyAtMaths, Aug 10, 2017.

  1. BusyAtMaths

    BusyAtMaths New Member

    Posts:
    8
    Hi all,

    Would really appreciate your advise. Today I need to choose one of the following mortgage rates. Both rates offer cash back 2% (which I will be use for furniture etc). First Time Buyer.

    The length of the Term is stalling me..

    1. PTSB 3.2% 3yr Fixed Rate (Term=32 years)
    Montly repayments: €1404
    After 3 years the Cumulative interest is €31,477

    OR

    2. BOI 3.0% - 3yr Fixed Rate (Term=30 years)
    Montly repayments: €1421
    After 3 years the Cumulative interest is €29,392

    Option 1 is cheaper by €17 per month. - Couldn't I reduce the term after the initial 3 years if I wanted?
    Is Option 2 better in the long term?

    Thanks.
     
  2. aristotle

    aristotle Frequent Poster

    Posts:
    676
    Option 2 is better longterm. Cheaper interest rate and shorter term.

    Plus I personally don't like PTSB and the way they treat existing customers so would opt for BoI.

    If check on some mortgage calculators you will see you will pay about 25k less interest over the full term on option 2 versus option 1.
     
  3. Cervelo

    Cervelo Frequent Poster

    Posts:
    283
    With the BOI option you will pay €612 more in mortgage payments but save €2085 in cumulative interest over the 3 years, so option 2 for me as well.
     
  4. Brendan Burgess

    Brendan Burgess Founder

    Posts:
    32,070
    Just look at the mortgage rate. Forget all the other calculations over 3 years, 30 years or 32 years.

    Bank of Ireland is cheaper. So it's better. It's better short term. It's better mid term and it's better long term.

    Option 1 is not cheaper. You are paying more interest so it's more expensive.

    But because you are paying less capital, your repayments are lower.

    And as Aristotle says, ptsb has treated, and continues to treat, their customers abysmally so you should only deal with them if you have no other option.

    Brendan
     
    RedOnion likes this.
  5. tommyryan55

    tommyryan55 Registered User

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    46
    As a soon to be ex PTSB mortgage customer I would avoid, go with BOI.
     
  6. BusyAtMaths

    BusyAtMaths New Member

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    8
    A resounding NO to Option 1 then.
    Yikes!
    Many thanks for the responses folks. I suspected as much, but the added feedback about PTSB is very helpful.
     
  7. Maxed123

    Maxed123 New Member

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    7
    Last edited: Aug 13, 2017 at 10:23 AM
    Busyatmaths do you mind me asking how you got the 3% rate with boi? Is your ltv lower than 80%? Thanks.
     
    Last edited: Aug 13, 2017 at 10:23 AM
  8. BusyAtMaths

    BusyAtMaths New Member

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    8
    Yes, fortunately our LTV comes in at 78% so 3% Fixed rate for 2 or 3 years.
     
  9. Maxed123

    Maxed123 New Member

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    7
    Thanks. Just wondering as also thinking of going with boi but ltv is 85% :(
     
  10. BusyAtMaths

    BusyAtMaths New Member

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    8
    BOI > 80% 3.2% Fixed.
    Is it worth considering KBC for their 1 Year Fixed Rate? Then assess things after 1 year, stay or switch to another lender then...
    1 Year >80-90% LTV 3.10%
    1 Year >80-90% LTV 2.90% (open a KBC current ac)
     
  11. Maxed123

    Maxed123 New Member

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    7
    Thanks might look into it