AIB Mortgage

anotheruser23

Hi All,

Not sure if I should post this here or in the personal finance section. But I'll try here anyway!

We are about to draw down on an AIB mortgage.

Does anyone know how easy it is to over pay your mortgage with AIB?

Can I transfer a couple of extra euro to the mortgage account on line should I have it left over at the end of a month? Will this be taken from the capital?

Thanks in advance.

The_Conductor

You don't normally pay a few extra Euro into the mortgage account- you sit down with the mortgage advisor and advise that you'd like to overpay the mortgage on a temporary basis. You get to specify whether you want the excess to reduce the term of the loan, or the monthly repayments. You can revoke the overpayment at any time (normally by giving them 14 days notice in writing)

NIMAN

I've made overpayments 4 times now, but they have been lump sums.

Also changed my monthly payment to fortnightly with AIB, they were happy to oblige. Also increased the fortnightly amount slightly when doing this, so there is flexibility.

But I don't think they would want, or allow you, to give them 'a few quid' extra each month, as you have to send a cheque to their HQ in Dublin to have it recalculated manually. Thats why they like decent sized lump sums I' guessing.

Eldarion

Something you should also take into consideration is your reasoning behind overpaying a mortgage. If you can earn a higher ROI than the interest rate of your mortgage then you shouldn't overpay simply because you can. Mortgages are a cheap source of credit and should be utilized as such.

Then again if you don't think you can beat a 5% ROI then by all means dump into the mortgage.

Chris_5339762

A general rule of thumb is that if you're on a good tracker, its more beneficial financially to put the money into savings instead. If you're on variable or a fixed term, its better to overpay the mortgage if you can (after the fixed term ends for example).

However even those on trackers need to consider the potential interest rate fluctuations.

NIMAN

The way savings interest rates are at present (minus DIRT of course) versus mortgage interest rates (unless on a tracker) I'd say that there is no great value in saving rather than paying off against your mortgage.

But it does depend of course of what mortgage rate you are on, and how long you are prepared to put savings away for to gain better interest rates.

If its a new mortgage the OP is taking out,m or recently taken out, then doubt they are on a tracker.

irishguy

If you are in a variable with aib you can transfer funds into it anytime using Internet banking.

ted1

Really, I can only see my account online but not pay onto it.

irishguy

ted1 wrote: »

Really, I can only see my account online but not pay onto it.

I just paid money in last week. Give them a ring and ask

ted1

irishguy wrote: »

I just paid money in last week. Give them a ring and ask

Just gave Internet banking a call, they said to call home mortgage team on Monday for them to make a change.

D3PO

ted1 wrote: »

Just gave Internet banking a call, they said to call home mortgage team on Monday for them to make a change.

you can defo do it. I have that facility on my AIB mortgage too whereby I can pay money off the mortgage using internet banking this despite the fact all notification on their site says you must call their mortgage centre and get approval to send an overpayment via cheque.

seems they have moved with the times and automated things.

Bluegrass1

You can walk into a branch an make a lodgement to the mortgage account. It can be done through quick lodge. I have done it several times.

air

Any mortgage account is no different to a bank account in that it has an account number & sort code. You should be able to transfer cash in any way you want.
I have an EBS mortgage & can transfer cash in ad hoc any time I want via internet banking. I can thus build up a credit balance & it will sit there reducing my daily interest until I decide what to do with it.At any time I can then instruct EBS to apply the balance to the capital amount & reduce either the payment or term. I would get additional credit at this point for the interest saved while it was sat in my account.
One option which I may explore would be the ability to temporarily stop the DD feeding the mortgage with the payments being met by the credit balance. This would be quite useful also.

pwurple

I overpaid on my last mortgage when we could. It's a great way of bringing that term down quickly. Just make sure you make the bank aware that you want the overpayment to be used to shorten the term, not to reduce the montlhly repayment.

air

I previously got them to reduce the term but of late I instead get the payment reduced.
However now I'm of the opinion that you should actually keep the orignal term as long as possible for maximum flexibility with cash flow.
This still leaves you the option to overpay on the agreed amount every month but if things are tight you can revert back to the lower payment associated with the longer term without needing the permission of your lender.

For example if you make a capital repayment that could reduce your term by 2 years or your amount by 100 euro, take the reduced monthly payment.
If you are worried you will spend the difference then set up a monthly standing order to your mortgage account for the additional 100 euro which you can then unilaterally cancel if it ever suits you.

NIMAN

D3PO wrote: »

you can defo do it. I have that facility on my AIB mortgage too whereby I can pay money off the mortgage using internet banking this despite the fact all notification on their site says you must call their mortgage centre and get approval to send an overpayment via cheque.

seems they have moved with the times and automated things.

I asked my local branch could I lodge via internet banking and they told me a cheque to their HQ was the only way. Gits!:mad:

Thing is, if you lodge electronically, what is the default - does the money come off the capital to reduce time left, or does it come off your monthly payments and keep the term unchanged?

irishguy

NIMAN wrote: »

I asked my local branch could I lodge via internet banking and they told me a cheque to their HQ was the only way. Gits!:mad:

Thing is, if you lodge electronically, what is the default - does the money come off the capital to reduce time left, or does it come off your monthly payments and keep the term unchanged?

It comes off the balance. Your repayments will be the same. Contact aib home mortgages, they will know. They may have to change the account type to allow you to transfer funds into it online. This will have no other implications for you. Most of the branch/call centre staff haven't a clue.

air

NIMAN wrote: »

I asked my local branch could I lodge via internet banking and they told me a cheque to their HQ was the only way. Gits!:mad:

Thing is, if you lodge electronically, what is the default - does the money come off the capital to reduce time left, or does it come off your monthly payments and keep the term unchanged?

It comes off the balance, you can then elect to either reduce your payment amount or mortgage term.
I would recommend leaving the term unchanged as this gives you maximum flexibility should you ever need it.

Moonbeam

I would save up a bit then pay it off the prncipal leaving your month payments the same but taking time of the term of the mortgage, you can get calculators to work out how much it saves but paying 15k could save you over 30 in the long run.