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AIB Mortgage overpayment

  • 20-03-2021 5:01pm
    Registered Users Posts: 193 ✭✭

    Relatively simple question but can't find it on AIB website.

    Does AIB allow overpayment on a fixed interest rate? I know BOI allow 10% or €65 (whichever is greater) per month without any charges.


  • Registered Users Posts: 2,038 ✭✭✭lau1247

    Yes, you can make an Overpayment on your mortgage, depending on what option you chose on the Overpayment form you can:

    Reduce your monthly scheduled repayment amount, by paying a lump sum payment, complete the relevant information on the Overpayment form and select option a) (this option is also available via on Internet Banking)

    Reduce your mortgage term by paying a lump sum payment, completing the relevant information on the Overpayment form and selecting option b)

    Increase your monthly mortgage repayment and reduce your term by completing the relevant information on the Overpayment form and selecting option c)

    You can only use an AIB funding account to make an Overpayment or Increase your scheduled monthly repayments when using this form

    For fixed rate customers please be aware that a breakage cost may occur if you pay a lump sum or wish to reduce your mortgage term.

    Extract from the link below, i guess overpayment can be treated as lump sum


  • Closed Accounts Posts: 12,449 ✭✭✭✭pwurple

    Yes, it’s allowed, but you will pay a breakage fee for it, so may not be worth it.

  • Registered Users Posts: 431 ✭✭ec_pc

    I was told in the past by AIB that if you are on fixed rate mortgage you can't overpay each month. This is why I am on variable with AIB,I pay a little over the odds in terms of variable interest rate compared to fixed, but aim is to pay mortgage of as soon as possible so i don't mind.

    Other option is to have a portion of mortgage fixed and remainder variable, I do believe AIB can offer this (but I could be wrong)

  • Registered Users Posts: 538 ✭✭✭Electric

    Yes, you can overpay on an AIB fixed rate. As a previous poster has said, there may be a breakage fee.

    Whenever I want to make an out of course payment, I just send them an email asking to make an out of course payment. So far, I haven't been charged any breakage fees.

  • Registered Users Posts: 193 ✭✭user302243

    ec_pc wrote: »
    I was told in the past by AIB that if you are on fixed rate mortgage you can't overpay each month.

    Cool thanks, ye I'd be looking at overpaying each month so even though AIB is lower interest rates BOI a works out cheaper in the long run.

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  • Registered Users Posts: 217 ✭✭irish_bhoy82

    Hi Guys, I have a fixed rate mortgage with AIB but I mistakingly used my mortgage bank details for a small payout from an insurance company(40 euro) I was just wondering if I should be worried about this that they may cancel the fixed rate deal or as it's such a small amount will they just carry on as before.

  • Registered Users Posts: 528 ✭✭✭Q&A

    Only way your fixed rate mortgage could be cancelled is if you overpaid by the whole amount! I'm guessing your mortgage is a little more substantial than €40.

    Worst happens there is a break fee but this will be calculated on the overpayment only i.e., A % of €40 so will be trivial.

    There are rules around how break fees are calculated. Roughly speaking they can only charge you what they would be out of pocket by if they had invested on the interbank market rather than your mortgage. If interbank rates have increased since you fixed there will be no break fee.

    With all that's happened in to interest rates in recent months a good many people on fixed rates have the capacity to overpay at no extra cost now.