Tracker mortgage - transferring it

chabsey

If you've a tracker mortgage with a small amount left on it and are thinking of moving house and possibly getting a bigger mortgage, is there any benefit in keeping the tracker 'alive' by not paying it off fully? The idea being you then borrow more on the same mortgage thus maintaining some aspects of the tracker, maybe getting a beneficial rate?

I presume this isn't possible but wanted to check. Assuming it is not possible, would the general consensus be just to finish off paying the tracker mortgage?

JVince

It is not possible.

Mortgages are attached to the mortgaged property. Once you sell it, the mortgage paid off by the solicitor and you get the balance. There is no other option.

Previously some banks offered a "tracker mover". They lump another 1%-2% onto the tracker rate and all the value of the balance to be on this new rate on a new mortgage. Frankly they were dreadful value.

Currently trackers are quite poor value and both fixed an variable rates are cheaper - and likely to be cheaper for the next 12 months. Even then, there will be little difference.

So, nope, its not possible and even if it was, it would not be worth it.

Gregor Samsa

I'll depend on your bank, but some do allow you to "transfer" what remains of your tracker to a mortgage on your new property - but note that it won't be under the same conditions as your current tracker.

BOI add on an extra percentage point to your current tracker interest rate. So if you have ECB + 1.75%, you'll end up with ECB + 1.75% + 1% (so ECB + 2.75%). Also, the "new tracker" part of your new mortgage will only be for the sum left on your old mortgage. Also, you'll only get the "new tracker" rate for the remaining time on your existing tracker - after that, it switches to the prevailing variable rate that will exist at the time. Also, note that it has to be a BOI tracker that you're moving - you can't get this rate with another's bank's tracker.

In the example they give on their website, they make it look attractive by having 200k left on the old tracker, and only 50k extra being needed on the new mortgage. But chances are at this stage (since most banks stopped offering them in 2008), most people looking to upgrade will be the other way around - a relatively small amount left on the tracker, and require a larger amount to top up with. Anyway, here's the BOI details:

https://www.bankofireland.com/help-centre/faq/can-keep-tracker-mortgage/

AIB have a very similar setup (+ 1% on top of your current tracker rate, only valid for the existing remainder of the tracker in terms of amount and time, and it has to be an existing AIB tracker)

https://aib.ie/our-products/mortgages/tracker-interest-rate-mortgage

chabsey

Thanks, figured it wasn't possible or wasn't a good deal, thanks for the replies.