Top-up mortgage with Bank of Ireland


Frequent Poster
I want to get a €55,000 top up on to my existing mortgage, and I've a few questions.

First, is the mortgage protection premium calculated on the outstanding balance, or on the initial mortgage?

I checked the mortgage protection cost on both the additional top-up amount alone and a combined existing outstanding balance and top-up. It was €147 for mortgage protection for €55,000 but only €59 extra to add that amount to the existing outstanding mortgage protection premium. Is there any downside in doing it the latter way?

Second, the Bank of Ireland mortgage person came back and said that their rate for the top-up is 2.9% for 3 years, or 3.2% for 5 years. The five-year fixed rate is 3.1% on our existing main mortgage. He said BofI could offer us a 3-year fixed rate of 2.9% on both the top up and existing mortgage. But wait for this: BofI would charge us a €5k plus fee if we broke the existing five-year fixed mortgage with them for this new rate they've offered us. I'm really not sure what they're playing at with that "offer".

At any rate, with that €5k penalty, and losing a further €5k or something similar from the second instalment of the 'Cashback' due in a couple of years, it would not be cheaper to move to KBC, even for its 2.6% rate. So, we're stuck with BofI. Consequently, which of the above Bank of Ireland offers would you choose?

Third, our existing 3.1% fixed rate on the main mortgage expires in 3.5 years. If we were to take up BofI's above 3-year fixed rate of 2.9% on the top-up mortgage, what are our options for the 6 months waiting for the main mortgage to run its course?

Thanks in advance.


Frequent Poster
It's not an "offer" and it's not a "penalty". You took out a five-year term presumably to insure against interest rates going up in the meantime. There are standard contractual charges to break out of a fixed-term mortgage. This is what they are quoting you.

On your third question, it all depends on the prevailing variable and fixed-rate options in three years' time.