Mortgage Query

Kagawa

Hi All,

I am currently 1 year into a 5 year fixed period on my mortgage with EBS at 3.8%. I have seen that with Ulster Bank there is a rate available of 2.5%, from looking at my mortgage there is a fee of approx 800 Euro to break from the fixed rate.

My question is this, to me it would seem to make sense for me to pay the breakage fee as I would save about 120 Euro per month on my mortgage if I moved to Ulster Bank. Am i missing something here, is there more too it than what I am seeing here?

TIA

Turkish1

Kagawa wrote: »

Hi All,

I am currently 1 year into a 5 year fixed period on my mortgage with EBS at 3.8%. I have seen that with Ulster Bank there is a rate available of 2.5%, from looking at my mortgage there is a fee of approx 800 Euro to break from the fixed rate.

My question is this, to me it would seem to make sense for me to pay the breakage fee as I would save about 120 Euro per month on my mortgage if I moved to Ulster Bank. Am i missing something here, is there more too it than what I am seeing here?

TIA

Few other factors e.g.
Legal fees, valuer fees - likely the €1,500 contribution from UB would cover this.
Open to correction, is there not a 2.3% UB rate available.
You should work out the different offers available, eg. boi Offering 3% back, could be the best offer for you depending on circumstances. Personally I worked it out over a 3 year period for myself knowing that i can switch again if aftrr my fixedrate is up that there is a better offer available.

Also, I am in the process of moving to PTSB myself, thet will not deal with a switcher if you have not been with your current mortgage provider for2 years.. i wonder have all banks taken the same approach to deter people switching regularly and taking advantage of cash back offers.

Mr E

I was looking at switching options this week too. I'm on EBS variable 3.7% and just found out that their fixed was now 3%.

Before committing to that, I decided to look around. My dad said Ulster Bank were offering something like 2.3% or something similar for Switchers, plus they pay €1500 towards legal fees. After some digging, I found that that's a nice attractive rate to try and get you to switch over, but the small print apparently says that you switch to a rate of 4.2% automatically after 2 years.

So I'm sticking with EBS at 3% fixed.

Moral of the story - look for the gotcha. If it looks too good to be true then it probably is.

Turkish1

Mr E wrote: »

I was looking at switching options this week too. I'm on EBS variable 3.7% and just found out that their fixed was now 3%.

Before committing to that, I decided to look around. My dad said Ulster Bank were offering something like 2.3% or something similar for Switchers, plus they pay €1500 towards legal fees. After some digging, I found that that's a nice attractive rate to try and get you to switch over, but the small print apparently says that you switch to a rate of 4.2% automatically after 2 years.

So I'm sticking with EBS at 3% fixed.

Moral of the story - look for the gotcha. If it looks too good to be true then it probably is.

All fixed rates go to the prevailing variable rate once the fixed term is finished. No surprise there really. Have you looked at BOI - 3% cash back and similar rate (off top of my head 3.1% i think for 3 year fixed) but you also get a nice lump sum - €9k on a €300k mortgage for example.

The way the current market is, you'd be mad to stay with the same provider as you won't get the best offers available.

Sarn

Mr E wrote: »

After some digging, I found that that's a nice attractive rate to try and get you to switch over, but the small print apparently says that you switch to a rate of 4.2% automatically after 2 years.

So I'm sticking with EBS at 3% fixed.

Moral of the story - look for the gotcha. If it looks too good to be true then it probably is.

As pointed out above it’s normal to move to the standard variable rate after the fixed. However, you don’t have to take it, you could move to whatever their lowest rate product is at the time or switch to another lender.

Kagawa

Thanks everyone but I did look into the UB 2.5% and it has a minimum of 500k value so there won’t be many with that much of a mortgage, well outside Dublin anyway

Sarn

Kagawa wrote: »

Thanks everyone but I did look into the UB 2.5% and it has a minimum of 500k value so there won’t be many with that much of a mortgage, well outside Dublin anyway

I don’t think their 2.3% rate has a minimum value.

Kagawa

Sarn wrote: »

I don’t think their 2.3% rate has a minimum value.

I was looking at the 5 year fixed option