Threatening to switch

B

Brandy

Registered User
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39
Hi,

just took a mortgage with BOI within the last 9 months and got the cash back etc.

Took out €330k over 30 years at 3.3% fixed for 10 years (advice of my dad).

Got a statement the other day and the reality hit. €15k paid so far but only €4K off the capital.

I know how mortgages work but a shock all the same.

can I reduce my rate by threatening to switch, enquiring about a break out fee?

Or just ring up and demand a lower fee by switching.

I feel I can do it myself. But forearmed is forewarned!

TIA.
 
All you can do is ask for a break fee and run the calcs on whether switching is worth while

ub are going 2.2 percent for 5 years
 
Call them and ask for a break fee, and work from there.
Depending on exactly when you fixed there could be just over 10k break fee.
 
There are better rates out there not too mention cashback offers that make it evening better but I wouldn't just focus on lower rates in isolation. A 10 year fix is never going to have the lowest rate around but you are locking in security of knowing your repayments won't increase over the next decade. If repayments are a large share of your disposable income and or you're likely to not have much spare cash to throw at your mortgage over the next 10 years then a longer fix makes sense. No point saving the pennies in the short term if it means putting your home in the medium term.

Assuming a 10 year fix makes sense both KBC and Ulster offer cheaper rates than what you're paying now. Both also offer greater flexibility in terms of overpayments than BOI. KBC you can overpay by 10% of the original balance over the lifetime of the fixation. Ulster allow 10% of the outstanding balance each year. As a BOI customer you can overpay by 10% of your monthly repayment. Not as flexible as the other 2 but something to consider if you have spare capacity and breaking out of your fixed rate is cost prohibitive.

Even with better rates and flexible overpayment options your mortgage is still likely to be a marathon not a sprint.
 
Thanks all for your replies.

Definitely a marathon!

I’ll check out the break out fee and could maybe look at paying a little extra each month.

Thanks again.
 
Why don't you do a few switches at the same time. You are getting 2% cash back so over €6000 a time. That will go some way to cancelling out you breakage fee of €10,000. Wait until you are 12 months with BOI and then switch to EBS, PTSB, KBC, AIB, and then finish with UB for 2.2%. Read up on the multiple switches forums.
 
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