Will 0.2% mortgage discount for using KBC Current Account continue if stop salary payments?

KBC give a 0.2% discount on mortgage rates where you pay the mortgage from a KBC Current account and have your salary lodged into that Current account (terms below). Given KBC are exiting and we need to move to new current accounts, I wonder has anybody asked KBC if you stop your salary going into the KBC Current Account today but the mortgage doesn't move for a few months if they'll continue to honour the 0.2% discount?

Trying to get ahead on changing over all DDs, standing orders etc. so would like to move my salary as well.

To avail of the optional extra Mortgage Discounted Rate (KBC’s prevailing new business fixed or variable rate with a discount of 0.20%), you must mandate your salary to your KBC Current Account (In an instance where a customer is self-employed, you must establish a monthly transfer to the Current Account to lodge an amount that is at least equal to the monthly mortgage repayment). You must also pay your new KBC Mortgage by Direct Debit from your KBC Current Account.

If you cease mandating your salary to your KBC Current Account and/or paying your KBC mortgage by Direct Debit from your KBC Current Account, the interest rate on your KBC Mortgage will increase by 0.20% i.e. the discount will no longer apply.

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Why would you stop paying your salary into your KBC account today?

1) Open a new account in whichever bank you choose.
2) When your mortgage is transferred to BoI you will keep the 0.2% discount.
3) Stop paying your salary when the KBC current account is closed.

If BoI don't buy the KBC mortgages, then nothing has changed.

I don't see why you would take any risk or spend any time trying to figure it out, when there is really no need to take that risk.

Brendan

A few reasons I guess -

1. I've moved my credit cards and all bills etc. over to a new BOI Current Account so need money coming into that account regularly to cover that stuff. Granted I could do a scheduled transfer from the KBC account across to this account to cover that off.

2. It can be a fair bit of hassle to get your employer to change payroll details (HSE for example ) so want to get it done well in advance to avoid issues at the last minute.

3. I spent 90 minutes trying to get through to BOI the other day, I suspect that's going to get worse (though I see today they have taken on more staff) so want to avoid any possible need to do that as we get closer to the cut-over date

4. I prefer to just execute on stuff like this, if I'm going to have to move I just want to get it done and close the KBC accounts/credit cards and move on with my life. New baby and house due around that time also, so pretty sure I'll thank past-Zenith63 for getting ahead of it.


None especially compelling I agree, but if somebody has already received an answer from KBC it would helpful.

Zenith63 said:

2. It can be a fair bit of hassle to get your employer to change payroll details (HSE for example ) so want to get it done well in advance to avoid issues at the last minute.

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I don't think you actually have to get the salary paid into the KBC account from your employer. It could come from your new BOI account after your salary is paid in to that account. It's still hassle but if it means you can have the new account up and running and keep your discount....

This is how I think it will work out...

1) When your salary hits your KBC account, transfer it over to BoI
2) The CCPC will approve the purchase of your mortgage by BoI - say May.
3) Your mortgage will transfer over to BoI say January 2023 - you will get a letter which will answer the .2% question
4) You will get six months notice from KBC to close your account.

You will have plenty of time to get your employer to switch to BoI.

If someone posts here "The fella in KBC told me on the phone that I could switch my salary now and it would be ok", I would ignore it completely.

Brendan

KBC have updated their FAQ on this, and it's great news!

Question:

"I have a discount on my KBC mortgage because I have a Current Account with KBC. What will happen to this discount if my mortgage is transferred to Bank of Ireland?"

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Answer:

There is no immediate impact on your KBC Mortgage discount as a result of this announcement. Should a Binding Agreement with Bank of Ireland receive regulatory approval, your KBC Mortgage will transfer to Bank of Ireland at a future date.

If your Mortgage transfers to Bank of Ireland, your Mortgage discount will continue to be honoured for as long as your Mortgage remains with Bank of Ireland. You will not be required to open a Bank of Ireland Current Account to avail of the discount. From the 1st June 2022, KBC will commence a process of engaging with customers regarding the closure of current accounts. As of that date, you will be able to close your KBC Current Account and your Mortgage Discount will be honoured by KBC Bank Ireland and by Bank of Ireland once your mortgage transfers.

In the meantime, you should continue to adhere to the KBC conditions associated with the discount i.e. continue to have your salary mandated to your KBC Current Account.

You will be notified well in advance of any actual steps or changes that may be taken in respect of your Mortgage.

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The next question then asks about closing the current account ahead of the mortgage move to BOI, and they say you can do it after 1 June 2022 and won't loose the discount. "From the 1st June 2022 you will be able to close your KBC Current Account and your Mortgage Discount will be honoured by KBC Bank Ireland and by Bank of Ireland once your mortgage transfers. In the meantime, you should continue to adhere to the KBC conditions associated with the discount i.e. continue to have your salary mandated to your KBC Current Account."

source: https://www.kbc.ie/mortgages/important-update [accessed 26 April 2022 at 22:30hrs]
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