Advertisement
If you have a new account but are having problems posting or verifying your account, please email us on hello@boards.ie for help. Thanks :)
Hello all! Please ensure that you are posting a new thread or question in the appropriate forum. The Feedback forum is overwhelmed with questions that are having to be moved elsewhere. If you need help to verify your account contact hello@boards.ie
Hi there,
There is an issue with role permissions that is being worked on at the moment.
If you are having trouble with access or permissions on regional forums please post here to get access: https://www.boards.ie/discussion/2058365403/you-do-not-have-permission-for-that#latest

FTB interest rate - fix for 3-year or 5-year or variable?

  • 16-05-2015 9:59pm
    #1
    jayjay2010
    Registered Users, Registered Users 2 Posts: 505 ✭✭✭


    Hey,

    I am a FTB and as there is a delay with my mortgage application, this gives me more time to decide which interest rate to choose from. I chose my mortgage with EBS and here are the current rates:

    VARIABLE 4.20%
    1 Year 3.50%
    2 Years 3.60%
    3 Years 3.65%
    4 Years 3.75%
    5 Years 3.80%

    I originally chose 5 years fixed as there is the security of knowing what I will be paying for the next 5 years. However, the 3 years option is what I am really leaning towards now as a) it has a cheaper rate and b) if I wanted to break the fixed term the penalty will be less that the 5 year option.

    However, I understand that the variable option means that I can pay off as much as I want each month. The thing I don't understand is, if I pay more than the actual amount does that come off the capital payment or interest payment? I don't fully understand how this works.... say I wanted to pay 5k in one go, do I pay interest on this 5k repayment???
    Tagged:


Comments

  • #2
    Paulw
    Registered Users, Registered Users 2 Posts: 13,381 ✭✭✭✭Paulw


    It is really one of those hard choice questions.

    Personally, when I bought, I took the 3 year fixed option. That way I knew exactly how much my mortgage would be for the 3 years. But, I had the option of 3 year, 5 year, variable or tracker. So, when my 3 years were up, I went tracker.

    You have to factor in the probability that mortgage rates can't stay this low forever, and will have to go up at some stage. Will that be within 3 years, 5 years or further out?

    Best of luck with your choice.


Advertisement