What would it take for you to give up your tracker mortgage?

Ando's Saggy Bottom

Forgive my naivety but I presume its impossible to get a tracker mortgage these days?

Scortho

Pete Campbell wrote: »

Forgive my naivety but I presume its impossible to get a tracker mortgage these days?

Yep!:(

On the trackers being removed its only in return for a debt write down/renegotiation. There has to be a bit of give from both sides of the trable so Id have no problem with it.
That said boi in the uk increased the tracker rate in the uk but there was a contractual agreement to that effect. They aren't able to do that here.

If you're on a tracker don't pay it off early if you can earn more after dirt with it on deposit. Currently kbc are giving 3% for instant access. Who knows how valuable that money on deposit could be to you in a few years time if you lose your job!
Just don't let it go over 100,000

Glenbhoy

Interest rates will not stay at historically low rates for ever, anyone being incentivised to move off their tracker should bear that in mind. You might another 2 or 3 years, but at some stage in relatively near future I would expect interbank rates and ecb rate to equalise and then who knows, maybe those on a +1.5 tracker will be paying more than those on a variable.

Corkbah

Glenbhoy wrote: »

Interest rates will not stay at historically low rates for ever, anyone being incentivised to move off their tracker should bear that in mind. You might another 2 or 3 years, but at some stage in relatively near future I would expect interbank rates and ecb rate to equalise and then who knows, maybe those on a +1.5 tracker will be paying more than those on a variable.

for the forseeable future (5-10yrs min) there will be very little signs of recovery - despite what "statistics" the government throw out....other countries throughout europe are facing economic distress and this will keep interest rates low, so at the moment the banks are looking to offload/remove the trackers but they are not willing to offer their customers anything near the value of the tracker.

my BIL (Brother-in-law) was offered €15K to switch from a tracker, he did the maths and if he was to switch the equivalent value of extra money he would be paying would be €80K, so he told the bank that he did the maths and financially he was better off staying with his tracker but if they were willing to increase their offer closer to €100K he would consider it.... he has no problems making payments at the moment but it was practically an insult by the banks with the offer they made....needless to say they said they were unwilling to meet his counter offer....and didnt increase their offer.

vicwatson

Pawwed Rig wrote: »

Exactly. I saw the bit about arrears but assumed I had missed something due to the posters sensationalist headline.


Yes if you are going to post a document to back up a point it is better to focus on what you are trying to say as people have not got time to read large volumes of text.

See link below this proves all of my points
http://www.independent.ie/

Aw musha, you haven't the time to read it, awww, well I posted the page number for you so you don't have to waste your precious time:)

NIMAN

I gave up my tracker, but I was more than happy to get my house sold and still make a profit.

Pawwed Rig

vicwatson wrote: »

Aw musha, you haven't the time to read it, awww, well I posted the page number for you so you don't have to waste your precious time:)

Read my other posts.

MMAGirl

Glenbhoy wrote: »

Interest rates will not stay at historically low rates for ever, anyone being incentivised to move off their tracker should bear that in mind. You might another 2 or 3 years, but at some stage in relatively near future I would expect interbank rates and ecb rate to equalise and then who knows, maybe those on a +1.5 tracker will be paying more than those on a variable.

People on trackers will be able to switch to variable if they want.

AlmightyCushion

fyfe79 wrote: »

Cheers Pawwed Rig. Yeah, it's something I've thought about.

I've a deposit account with BOI for the past 3 years or so which is paying out 2%. Which crowd offers 3%? I'm interested in that!

You're right regarding paying the overpayment (€300) into a deposit account instead of off the mortgage, I should really get my arse in gear and do that sooner rather than later. Makes total sense. I think I just like the idea of over-paying my mortgage for some reason!

http://www.askaboutmoney.com/showthread.php?t=20747

Regular Saver with KBC gives 3.5%. Even after DIRT the interest you'll earn will be a nice margin about what you're paying on the mortgage especially when compounded over many years.

fyfe79

Thanks for the link, AlmightyCushion. So I'm paying into the worst depostit account (BOI) and overpaying my tracker mortgage... not great financials!

I can't close the deposit account for another 18 months approx, but can cancel the tracker overpayment anytime, which I will do. 3.5% with KBC sounds mighty.

AlmightyCushion

fyfe79 wrote: »

Thanks for the link, AlmightyCushion. So I'm paying into the worst depostit account (BOI) and overpaying my tracker mortgage... not great financials!

I can't close the deposit account for another 18 months approx, but can cancel the tracker overpayment anytime, which I will do. 3.5% with KBC sounds mighty.

2% is far from the worst, there are accounts paying out less interest than that. There are probably loads of legacy accounts out there that at one time were paying good rates but have since been reduced to next to nothing and the people who own them are none the wiser. So, you weren't doing too badly but your money could be doing more for you.

Pawwed Rig

Definitely 2% is not the worst. At least you have put some thought into it. Alot of people leave large amounts of cash sitting in current accounts at 0%.

fyfe79

I've just double-checked the BOI deal and I can actually close it anytime without fees, so I'll close that and stop my tracker overpayment.
I've printed off the KBC 'Regular Saver' application form so I'll get the ball rolling.

Thanks a million for your help lads, great stuff

Glenbhoy

Corkbah wrote: »

for the forseeable future (5-10yrs min) there will be very little signs of recovery - despite what "statistics" the government throw out....other countries throughout europe are facing economic distress and this will keep interest rates low, so at the moment the banks are looking to offload/remove the trackers but they are not willing to offer their customers anything near the value of the tracker.

I agree there will be little signs of recovery, that doesn't mean that the bundesbank will be happy to keep interest rates at their current level. I don't think for a minute that forseeable future is anywhere near 5-10yrs either, if anyone can forsee that long, they're wasting their time posting on here, they should be advising govts or busy making money with their own hedge fund.

Glenbhoy

MMAGirl wrote: »

People on trackers will be able to switch to variable if they want.

That was actually tongue in cheek, but on reflection, will they??

StillWaters

Glenbhoy wrote: »

That was actually tongue in cheek, but on reflection, will they??

Why would they?

Glenbhoy

StillWaters wrote: »

Why would they?

We were discussing the probability of ECB rates increasing again to historical norms and the hypothetical situation wherein variable rates are 7.3% but Tracker is at ECB +1.5% when ECB rate is 6%.

NIMAN

Is the ECB not rumouring to be lowering the base rate again, I would say its a long way off ever being 6%.

MMAGirl

Glenbhoy wrote: »

That was actually tongue in cheek, but on reflection, will they??

Sorry. Meant to say variable or fixed, not just variable

MMAGirl

NIMAN wrote: »

Is the ECB not rumouring to be lowering the base rate again, I would say its a long way off ever being 6%.

True. And if you do a search on boards you will see people saying " interest rates are only going one way" from many years back.

Glenbhoy

MMAGirl wrote: »

True. And if you do a search on boards you will see people saying " interest rates are only going one way" from many years back.

and they have, but now that they're pretty much on the floor there is only one way they can go.

Corkbah

Glenbhoy wrote: »

and they have, but now that they're pretty much on the floor there is only one way they can go.

wrong ...they can ....

1. stay there
2. go up
3. go down even further

so.... more than one way they can go ..in all likelihood they will remain static for a number of years to come, I don't see them raising for at least 3-5yrs ...and at that it'll be a slow increase.

Pawwed Rig

There has been cases of negative interest rates in history. Now while I can't see the ECB going there never say never.
It reminds me of threads where people claim the property market has hit rock bottom.........................errr has it?
Noone knows. If we did we could make a killing on derivatives on the Financial markets

MMAGirl

Pawwed Rig wrote: »

There has been cases of negative interest rates in history. Now while I can't see the ECB going there never say never.
It reminds me of threads where people claim the property market has hit rock bottom.........................errr has it?
Noone knows. If we did we could make a killing on derivatives on the Financial markets

Much like all the people wishing for a property crash and when they got it they realized that there is much, much worse that goes along with it, if interest rates went negative I think there would be a lot of other worse things along with that scenario. I really hope we dont go there.

ongarboy

Glenbhoy wrote: »

and they have, but now that they're pretty much on the floor there is only one way they can go.

They've been on the floor for years and haven't moved upwards at all. In fact, speculation this week said that a further reduction of 0.25% next month is on the cards - even better news for all the tracker holders. The downside of this is that the savings/deposit rates for non fixed savings also drop when there is an ECB drop.

The rates will remain low as long as inflation is low and the EU economy is struggling. I understand rates generally only rise to curb overheating of the economy or when inflation spirals upwards dramatically (neither of which is going to happen in the EU anytime soon).

D3PO

pointless discussion IMO.

Because any "Deal" the bank accepted would only be accepted if its a better option for them financially long term on the mortgage.

Which then means you will get a bad deal for letting go of your tracker. They aren't going to do a deal that is worse for them than you hanging onto the tracker. Therefore no deal can be don't in your benefit so no deal should be done.

Pawwed Rig

Not a pointless discussion. There have been some very informative posts here. What you're saying is correct but if you could imaging a scenario with a person who owes say €100,000 and has €60,000 in the bank. If a bank offered him a write off on some of the capital it might be in his interest to pay off the whole mortgage as the return on his €60,000 in savings would not be high enough to equal the capital gained.

And pointless discussions can have merit too. I was just over in the Zombie Holocaust Survival forum:D

Glenbhoy

Pawwed Rig wrote: »

There has been cases of negative interest rates in history. Now while I can't see the ECB going there never say never.
It reminds me of threads where people claim the property market has hit rock bottom.........................errr has it?
Noone knows. If we did we could make a killing on derivatives on the Financial markets

That's really what I'm trying to say, none of us or anyone else out there really has much of an idea. The market moves in mysterious ways and anyone taking a view beyond a year or so is kidding themselves.

D3PO

Pawwed Rig wrote: »

. What you're saying is correct but if you could imaging a scenario with a person who owes say €100,000 and has €60,000 in the bank. If a bank offered him a write off on some of the capital it might be in his interest to pay off the whole mortgage as the return on his €60,000 in savings would not be high enough to equal the capital gained.

that scenario wouldn't exist (or at least shouldn't if the person your talking about is financially astute which given the outlined scenario would suggest they are)

if they had 60k on deposit its because the 60k on deposit even after dirt is yielding more in interest than the same in savings if it were paid off the mortgage principle. Therefore the return you suggest they may get from a deal and paying off the principle with their savings wouldn't exist

Tombo2001

Again I will ask the question.....

Has any bank in Ireland.....

negotiated one single deal....

.....to get somebody off a tracker mortgage and on to a variable***

.....and offerred debt writedown in return....

Is anyone aware of this happening even once?

I amnt.....

And yet every couple of months I see this media discussion about how much you would have to get to give up the tracker, as if banks were out knocking door to door beggin people to do this.

I'd be delighted to negotiate 50k off my mortgage to give up the tracker.

Its not an option.....its not available......its a fantasy......



*** and I'm not talking about cases where the mortgage holder cant pay.....thats a different type of deal.