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Nearing end of Mortgage Fixed Term - Renewal Advice

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  • 31-01-2022 6:03pm
    #1
    joe123
    Registered Users Posts: 6,521 ✭✭✭


    Hey all, my current Fixed Term is due to end at the end of March.

    Ive started looking into renewing and using sites such as https://www.ccpc.ie/consumers/money-tools/mortgage-comparisons/ and bonkers to help give me an idea what the rates. Im just looking for some advice on here of things I should look out.

    • Avg. Cost of legal/solicitor fees if I move away from my current bank? (looking likely as they are expensive compared to others)
      • And is it worth it?
    • Should I do my best to bring the LTV value down (of what I can afford of course) - Its a relatively new purchase so im around the 80% LTV. The valuation of the house was automatically done by Ulster Bank and has it a lot higher than I expected. Houses in my area are going for around 270 - 280k, the bank valuation has it in above 300k.
    • Is it better financial advice to stick with a higher monthly repayment and reduce the term of the mortgage or what do people think?
    • Are there any banks currently that people would recommend? - I see on the compare sites AIB offer 2k cashback which would help cover legal fee if I switched to them and they appear to have one of the lowest rates under their green energy offer.
    • How soon should I start the process of switching? I assume if I stayed with my current bank itd be seamless and no legal fees involved.

    Is there anything Im missing from the above or any good sites that I should read up on?



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    #2
    cruizer101
    Registered Users Posts: 3,205 ✭✭✭cruizer101


    Legal fees I think will run you around 1500 for changing bank.

    Is it worth it? Depends on the rates, but there is a good chance it is worth doing, even without a cashback offer you could save enough to cover fees in less than a year and then it is all gain for you.

    It could be worth bringing LTV down typically bands at 80%, 70%, 60%, 50% (not all banks will have bands at all values) so if you are close to a band might be worth it I think would typically give you 0.1% of difference so not much but if fixing for longer period adds up.

    I think best to keep the term as long as possible and then if you want overpay (there can be restrictions on overpaying) that way if down the line you need to reduce payment (job loss, injury, kids etc.) you just stop overpaying, rather than have to negotiate with bank. But different people have different opinions on this, e.g. consider maxing pension contributions instead.

    I think Avant and AIB are best on offer atm, but check CPCC mortgage comparison website.

    If you stay with current bank you will automatically get moved over to their variable rate, they should contact you in advance to advise of different options e.g. fixing again with them. If you stay there are no legal fees.



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