Bank of Scotland Ireland Early Mortgage Pay Off Bonus

dunderrow

Hi - I have a tracker mortgage with BOSI with €130 k balance and about 18 years left on it.

I am looking to do a substantial extension to the property and as BOSI don't offer mortgages in Ireland any more need to remortgage with another bank.

My question is if anyone else has managed to get a bonus or some financial reward for opting out of a tracker early with BOSI - from what I understand they are losing thousands on this mortgage so it would be in their interest to incentivise early leavers?

The property is currently worth about €250k and I have never missed a payment and have no other outstanding loans or credit (if that makes any difference)

I have pre-approval for the new mortgage amount I need but haven't officially applied as thought it may show my hand to BOSI but need to get moving on this soon.

Any thoughts or advice appreciated

SBarrett

Banks don't do deals on paying off tracker mortgages early. It seems to have developed into an urban myth over the years but there is no evidence that it has actually been done.


Steven

dunderrow

Thanks for that Steven,

Pity - it is really killing me having to give up the tracker, just unlucky I picked BOSI as Irish lenders now seem to be facilitating moving trackers within the same bank.

Oral Surgeon

Can you not look for finance for the extension in another bank?? Is there then an issue with who has first dips on the property if you default..??

dunderrow

Hi Oral Surgeon - not as a mortgage, only as a home improvement loan with interest rates of 10%+

Trish56

SBarrett wrote: »

Banks don't do deals on paying off tracker mortgages early. It seems to have developed into an urban myth over the years but there is no evidence that it has actually been done.


Steven

Permanent tsb offered discounts for early redemption a few years ago to customers with tracker mortgages.

OP has nothing to lose by writing to BOS asking if discount is available to redeem.

D3PO

dunderrow wrote: »

Hi Oral Surgeon - not as a mortgage, only as a home improvement loan with interest rates of 10%+

which is likely to be less than the money you lose by remortaging and losing your tracker.

Have you actually done the maths on this ?

Oral Surgeon

dunderrow wrote: »

Hi Oral Surgeon - not as a mortgage, only as a home improvement loan with interest rates of 10%+

ah yeah... do the maths though... losing the tracker may be more expensive depending on the amount....

dunderrow

I suppose I haven't done the sums in any great detail - I would need to borrow an additional 65k, I am putting in another 70k of my own savings as well.

Online inquiries show that you cant repay a personal loan for more than 5yrs - if I could borrow over 10+ years it would be much more attractive for many reasons.

Does anyone know of

1/ Banks offering longer term personal loans?

2/ How to do the sums factoring in total interest costs?

Oral Surgeon

dunderrow wrote: »

I suppose I haven't done the sums in any great detail - I would need to borrow an additional 65k, I am putting in another 70k of my own savings as well.

Online inquiries show that you cant repay a personal loan for more than 5yrs - if I could borrow over 10+ years it would be much more attractive for many reasons.

Does anyone know of

1/ Banks offering longer term personal loans?

2/ How to do the sums factoring in total interest costs?

€195K on the variable rate of 4.5% for 30 years is €988/month
€65K at 11.5% for 5 years is €1410/ month!!

What do you pay currently??

The 5 year personal loan is high but at least you will save on interest if you can manage it....

dunderrow

Paying just under €600 pm at the moment - €2k+ pm repayments are not really feasible at the moment but if I could borrow over 10 or more years it might be more do-able,

Thanks for the sums OS - I had done that much on my own, it was more the total overall cost of both options I was wondering about..

dunderrow

PS - Thanks Trish 56 - you are right, I have nothing to loose, have just written a letter to BOS asking them to make me an offer I cant refuse!!

Marcusm

You have a lot of equity in the house plus you are planning on funding half of the improvements. Have you had an estimate of the likely value once the funds have been spent? Given the equity buffer, a second mortgage would be an option although this is unlikely to be standard product and may require effort on the part of a broker.

dunderrow

Hi Marcusm, likely value would be €400 to €420k at the moment but its in a good area so would expect to rise more when I finish landscaping etc.

Ideally I would love to have a separate loan for the extension but I cant see the Bank of Scotland agreeing to any joint mortgage as they are not open to changing terms on any mortgage now that they have left Ireland.

Marcusm

dunderrow wrote: »

Hi Marcusm, likely value would be €400 to €420k at the moment but its in a good area so would expect to rise more when I finish landscaping etc.

Ideally I would love to have a separate loan for the extension but I cant see the Bank of Scotland agreeing to any joint mortgage as they are not open to changing terms on any mortgage now that they have left Ireland.

THere is no "joint" mortgage concept, it would be a second mortgage meaning that any new lender would only get paid out after BOSI (in the event of default or repossession). Given the debt levels involved, it would be easy to arrange in a sensible banking market. For Ireland int he current circumstances, a broker would likely be needed. Basically, BOSI are owned 130k on the 420k house; the new lender would be asked to advance 65k against the balance of the equity. It would be more expensive but hopefully not prohibitively. BOSI wouldn't need to be involved.