Mortgage - low fee for breaking fixed rate

christy c · 06-02-2020 2:50pm

listermint wrote: »

What's outlay ?

Search fee, postage and other mumbo jumbo.

christy c · 06-02-2020 2:50pm

brightkane wrote: »

Got a quote today for 1500 all in

Cheers, so there should be better around.

steves2 · 06-02-2020 3:06pm

christy c wrote: »

What are people paying in legal fees for switching? I was quoted €1,250 excluding VAT and outlay. About €1,900 all in.

I intend to shop around more.

It all depends on the solicitor, I've been quoted 1200 and that's the best in my area, a friend of mine near Naas was quoted 900 but that can rise. I'm starting the switch to KBC, will knock 1% and 3 years off my mortgage.

Millem · 06-02-2020 3:53pm

deco72 wrote: »

Would you not think about going with KBC instead on the 2.25% mortgage and €3000 cashback. It's also only a 2yr fixed rather than a 5yr. So could easily do the same again in 2yrs time if it was worthwhile.

My ltv is higher than 60% and third baby due so thinking of fixing for 5 years.

christy c · 06-02-2020 4:24pm

steves2 wrote: »

It all depends on the solicitor, I've been quoted 1200 and that's the best in my area, a friend of mine near Naas was quoted 900 but that can rise. I'm starting the switch to KBC, will knock 1% and 3 years off my mortgage.

Just got quoted 1200 all in after a few phone calls. Happy with that

BullBauld · 06-02-2020 6:31pm

House is worth approx €220,000 with 90k left on mortgage. Probably no value switching banks but to look for better rate maybe. Currently with BOI 3.2% fixed for 3 years.

chases0102 · 06-02-2020 7:15pm

Can the breakage fee vary significantly? I remember looking into this a few months back, breakage fee was about 10k.

Just under 2 years into 30 year mortgage, 5 year BOI fixed at 3%

christy c · 06-02-2020 7:47pm

BullBauld wrote: »

House is worth approx €220,000 with 90k left on mortgage. Probably no value switching banks but to look for better rate maybe. Currently with BOI 3.2% fixed for 3 years.

With KBC you get €3000 cashback minus costs of approx €1500 - €2000 so you'll have at least €1000 in your back pocket. Also their rate would be 2.25% if you open a current account. Don't know what it would cost to get out of your Bank of Ireland fixed rate.

mrcheez · 06-02-2020 8:21pm

christy c wrote: »

With KBC you get €3000 cashback minus costs of approx €1500 - €2000 so you'll have at least €1000 in your back pocket. Also their rate would be 2.25% if you open a current account. Don't know what it would cost to get out of your Bank of Ireland fixed rate.

If you open the current acc do you have to use it, or can I just lodge a couple hundred and be done with it?

browne_rob5 · 06-02-2020 9:04pm

mrcheez wrote: »

If you open the current acc do you have to use it, or can I just lodge a couple hundred and be done with it?

You have to pay your mortgage from it to get the lower rate. Think it's 2.45% for 2 years otherwise. You also have to lodge €2k each month to get free banking on the current account.

I just switched all my banking to KBC. You could get your salary into KBC and pay your mortgage from there and transfer the balance to whatever bank you're using each month.

KilOit · 06-02-2020 9:06pm

Maybe someone can make sense of this.

I'm on AIB variable 2.95% which is APRC 3.01%
so if i switch to Ulster bank it's 2.2% which is 3% APRC

how am i saving if i switch to Ulster bank

christy c · 06-02-2020 9:36pm

browne_rob5 wrote: »

You have to pay your mortgage from it to get the lower rate. Think it's 2.45% for 2 years otherwise. You also have to lodge €2k each month to get free banking on the current account.

I just switched all my banking to KBC. You could get your salary into KBC and pay your mortgage from there and transfer the balance to whatever bank you're using each month.

I also think you need to get your salary paid in to get the lower rate.

BBMcQ · 06-02-2020 9:38pm

KilOit wrote: »

Maybe someone can make sense of this.

I'm on AIB variable 2.95% which is APRC 3.01%
so if i switch to Ulster bank it's 2.2% which is 3% APRC

how am i saving if i switch to Ulster bank

The APRC is advertised over the lifetime of the loan, not the fixed rate period. Ulster bank have much higher standard variables post fixed period.

BBMcQ · 06-02-2020 9:45pm

Folks, I think it’s super important to highlight because 9 out of 10 ppl don’t know this

ALOT of the times it will make sense for you to break out of a bad fixed rate deal. Some people thing you are stuck in a fixed rate deal no matter what.

We got AIB down from a near 5k breakage fee down to near 900! Now Ulster bank aren’t charging us anything to switch from their 2.6% fixed to 2.2% fixed. EU rules mean that a bank can only charge you a break fee based on what it would cost them to finance the remaining principle plus admin costs. AIB in particular weren’t following this until approx July 2019.

It’s staggering to think of the amount of money out there being overpaid to banks on mortgages....

Also 1500 all-in is the target price for a solicitor to switch. You don’t even need to meet them so I wouldn’t pay more for one just because their office is in D4.

KilOit · 06-02-2020 10:55pm

BBMcQ wrote: »

The APRC is advertised over the lifetime of the loan, not the fixed rate period. Ulster bank have much higher standard variables post fixed period.

Ah that makes sense, cheers, bit of a no brainer, savings could be put into the principle after the 5 years if i was to switch again

TakeTheVeil · 07-02-2020 10:08am

For €300,000+ mortgages, any obvious reasons not to avail of EBS 2% cashback with 1 year fixed rate 2.9,...and then switch to KBC/Ulster for lower rate this time next year (other than the risk of rates increasing over the next year)?

brightkane · 07-02-2020 10:27am

TakeTheVeil wrote: »

For €300,000+ mortgages, any obvious reasons not to avail of EBS 2% cashback with 1 year fixed rate 2.9,...and then switch to KBC/Ulster for lower rate this time next year (other than the risk of rates increasing over the next year)?

I am thinking this also. Currently about 18 months into a 5yr fixed with PTSB on 3.1%.
Thinking of moving to BOI for 1 year to get 2% cashback and then if ulsterbank are doing 2.2% next year flip to that. After legals for switch to BOI and breakage fee I would have €3,700 approx.

Q&A · 07-02-2020 10:31am

TakeTheVeil wrote: »

For €300,000+ mortgages, any obvious reasons not to avail of EBS 2% cashback with 1 year fixed rate 2.9,...and then switch to KBC/Ulster for lower rate this time next year (other than the risk of rates increasing over the next year)?

One issue I have with this.... Why wait! Get loan approved with both and switch as soon as soon as cashback is paid. Assuming cashback takes a month to process the break fee will more than likely be small or zero.

Worst case scenario you end up waiting the year like planned. Best case 2 cashbacks in the bag and cheap rate as you head into late spring.

mrcheez · 07-02-2020 10:54am

How does the TRS monthly payment get affected by the changeover? Do I need to notify Revenue or the banks do it themselves?

I'm going to be going over all my TRS payments made since I started the mortgage as I recall BOI were short a couple of hundred when I checked 5 years ago, I'd probably have a hard time claiming it back after I've moved.

browne_rob5 · 07-02-2020 3:01pm

TakeTheVeil wrote: »

For €300,000+ mortgages, any obvious reasons not to avail of EBS 2% cashback with 1 year fixed rate 2.9,...and then switch to KBC/Ulster for lower rate this time next year (other than the risk of rates increasing over the next year)?

Sounds like a good plan and cant see a reason not to.

flugel · 07-02-2020 10:52pm

BBMcQ wrote: »

We got AIB down from a near 5k breakage fee down to near 900! Now Ulster bank aren’t charging us anything to switch from their 2.6% fixed to 2.2% fixed. EU rules mean that a bank can only charge you a break fee based on what it would cost them to finance the remaining principle plus admin costs. AIB in particular weren’t following this until approx July 2019.

How did you get AIB to lower breakage fee?

I'm with BOI, 3 years through a 5 year fixed. The breakage fee I'm being quoted is north of 2k, and that's to stay with BOI on a lower rate.

If I leave BOI there's also a redemption fee, again it's considerable.

I do have over 20 years left on lifetime of mortgage so unless that's what's working against me

BBMcQ · 07-02-2020 11:13pm

flugel wrote: »

How did you get AIB to lower breakage fee?

I'm with BOI, 3 years through a 5 year fixed. The breakage fee I'm being quoted is north of 2k, and that's to stay with BOI on a lower rate.

If I leave BOI there's also a redemption fee, again it's considerable.

I do have over 20 years left on lifetime of mortgage so unless that's what's working against me

We were 2 years into a 34 year mortgage. My other half fought tooth and nail and basically forced AIB to change their rules! All the way through, we asked for the calculations of the breakage fees. The folks on askaboutmoney are brilliant with advice also.

fjon · 08-02-2020 10:07am

Very good thread, I didn't realise the fees could be so low.
I'm 1 year into a 28 year mortgage with KBC (3.2% fixed for 3 years). Rang them recently to ask what the break fee was to pay off a lump sum and they quoted me 250ish over the phone.
Is that number based on the lump sum amount?
Also, would it be a good idea to try to get onto a lower rate at the same time as paying the lump sum?

Q&A · 08-02-2020 10:08pm

fjon wrote: »

Very good thread, I didn't realise the fees could be so low.
I'm 1 year into a 28 year mortgage with KBC (3.2% fixed for 3 years). Rang them recently to ask what the break fee was to pay off a lump sum and they quoted me 250ish over the phone.
Is that number based on the lump sum amount?
Also, would it be a good idea to try to get onto a lower rate at the same time as paying the lump sum?

If you didn't specify the amount you wanted to break my guess is it's for the whole amount. You can always clarify with them.

Looking at the rates that KBC currently offer you can definitely do better. 3 Year >80-90% LTV is currently 2.85%. Lower LTVs are better still.

https://www.kbc.ie/our-products/mortgages/our-mortgage-rates

Cyrus · 08-02-2020 10:39pm

fjon wrote: »

Very good thread, I didn't realise the fees could be so low.
I'm 1 year into a 28 year mortgage with KBC (3.2% fixed for 3 years). Rang them recently to ask what the break fee was to pay off a lump sum and they quoted me 250ish over the phone.
Is that number based on the lump sum amount?
Also, would it be a good idea to try to get onto a lower rate at the same time as paying the lump sum?

The 250 is the penalty on the partial redemption that you enquired about to move will incur a full breakage fee

fjon · 08-02-2020 10:56pm

Cyrus wrote: »

The 250 is the penalty on the partial redemption that you enquired about to move will incur a full breakage fee

To move to a lower rate? Or to move to a different bank?

Cyrus · 08-02-2020 11:06pm

fjon wrote: »

To move to a lower rate? Or to move to a different bank?

It normally doesn’t matter as it amounts to the same thing

Etnies · 10-02-2020 12:00am

flugel wrote: »

How did you get AIB to lower breakage fee?

I'm with BOI, 3 years through a 5 year fixed. The breakage fee I'm being quoted is north of 2k, and that's to stay with BOI on a lower rate.

If I leave BOI there's also a redemption fee, again it's considerable.

I do have over 20 years left on lifetime of mortgage so unless that's what's working against me

I've broken twice in 2 years on a 35 year mortgage both times on a 5 year fixed, first was 250 second was free. Now on 2.5% the lowest AIB offer.

deco72 · 10-02-2020 10:15am

Etnies wrote: »

I've broken twice in 2 years on a 35 year mortgage both times on a 5 year fixed, first was 250 second was free. Now on 2.5% the lowest AIB offer.

What banks were you with that the rate was so low to break the fixed term? I just broke away from AIB and moved to TSB.

Does anyone know how much the breakage fee is with TSB?

circadian · 10-02-2020 10:19am

I've just moved from a Variable Rate of 3.7% with AIB to the 2.5% 5 year fixed rate they offered. I wonder if they see some sort of recession coming and are trying to shore down as many 5 year rates as possible.

Cyrus · 10-02-2020 10:27am

Etnies wrote: »

I've broken twice in 2 years on a 35 year mortgage both times on a 5 year fixed, first was 250 second was free. Now on 2.5% the lowest AIB offer.

It’s all to do with inter bank rates and when you fixed and for how long

Break fees were low or nil for a lot of people who fixed in 2017 and broke out in 2018

MB Lacey · 10-02-2020 10:45am

circadian wrote: »

I've just moved from a Variable Rate of 3.7% with AIB to the 2.5% 5 year fixed rate they offered. I wonder if they see some sort of recession coming and are trying to shore down as many 5 year rates as possible.

I'm with AIB on their 3.15% Var, saw that 2.5% 5 yr fixed and got very excited.
Glad you got it - but looking into it, not a chance my house would get a decent BER certificate.

I'm going to go for the 2.75% 3 yr fixed instead - unless anyone has seen any better offers?

Sparky85 · 10-02-2020 10:50am

MB Lacey wrote: »

I'm with AIB on their 3.15% Var, saw that 2.5% 5 yr fixed and got very excited.
Glad you got it - but looking into it, not a chance my house would get a decent BER certificate.

I'm going to go for the 2.75% 3 yr fixed instead - unless anyone has seen any better offers?

UlsterBank “high value” mortgage >300k 2.2% fixed for 5 years

mrcheez · 10-02-2020 10:55am

For anyone receiving TRS, make sure to add up all the payments you've received since 2012 (or earlier) against what you're supposed to have received.

I found I'm €850 short.

Probably need to get this sorted before I move provider.

MB Lacey · 10-02-2020 10:56am

Sparky85 wrote: »

UlsterBank “high value” mortgage >300k 2.2% fixed for 5 years

Thanks Sparky, I did see that, but I've 220k left to pay so don't qualify.

mrcheez · 10-02-2020 1:28pm

cruizer101 wrote: »

Go to https://www.ccpc.ie/consumers/financial-comparisons/mortgage-comparisons/
It will lay out all the different rates for whatever LTV you are.
It won't show cashback offers however so you will have to take those into account.

When using this search form, do you enter the house value as it was when purchased, or the estimated current value?

The same query for when changing provider, do they still use the original property value as it was when purchased?

deco72 · 10-02-2020 1:40pm

mrcheez wrote: »

When using this search form, do you enter the house value as it was when purchased, or the estimated current value?

The same query for when changing provider, do they still use the original property value as it was when purchased?

You would enter the current value of the house.
You'll need to get a new valuation report done. Roughly €150.

mrcheez · 10-02-2020 2:55pm

deco72 wrote: »

You would enter the current value of the house.
You'll need to get a new valuation report done. Roughly €150.

I need to get that done before I apply to change provider?

bazz26 · 10-02-2020 3:17pm

Some banks will include a free property valuation as part of their mortgage switcher package, others will give you a larger cash amount to switch which you can put towards you getting your own valuation, solicitor's fees, etc to cover the cost of switching. Either way a property valuation will need to be done by a legitimate and approved valuer as part of the switching process. They won't just take your word on the valuation.

Ush1 · 11-02-2020 2:33pm

mrcheez wrote: »

For anyone receiving TRS, make sure to add up all the payments you've received since 2012 (or earlier) against what you're supposed to have received.

I found I'm €850 short.

Probably need to get this sorted before I move provider.

Really? Was that the bank at fault?

mrcheez · 11-02-2020 4:50pm

Ush1 wrote: »

Really? Was that the bank at fault?

It's fine, I didn't realise that they tapered the usual payments by 75% in 2018 and 50% in 2019! :rolleyes:

This was as opposed to suddenly cutting it off at the end of 2017.

2020's payment are 25% of the usual and then it's finally gone.

bugsyb4 · 12-02-2020 10:40am

mrcheez wrote: »

It's fine, I didn't realise that they tapered the usual payments by 75% in 2018 and 50% in 2019! :rolleyes:

This was as opposed to suddenly cutting it off at the end of 2017.

2020's payment are 25% of the usual and then it's finally gone.

Bit off topic but said would ask someone might have the answer for me here.

We were getting this with full entitlement up to December 2019 and then that month amount we received dropped and has since followed through this year in line with 25%. So went from full amount of €37.50 (whole of 2019 apart from Dec) to €28.48 (Dec 2019) to €12.34 (2020 onwards). I was hoping to be receiving €18.75 for 2020, not massive diff but all counts.

Any clue why that would have dropped to begin with? No notification from anyone about it.

mrcheez · 12-02-2020 10:59am

bugsyb4 wrote: »

Bit off topic but said would ask someone might have the answer for me here.

We were getting this with full entitlement up to December 2019 and then that month amount we received dropped and has since followed through this year in line with 25%. So went from full amount of €37.50 (whole of 2019 apart from Dec) to €28.48 (Dec 2019) to €12.34 (2020 onwards). I was hoping to be receiving €18.75 for 2020, not massive diff but all counts.

Any clue why that would have dropped to begin with? No notification from anyone about it.

Ask your provider how much interest you were charged in 2019.
Then tot up all the TRS payments you received.

The TRS total received should be half of 20% of the interest. (i.e. it should be 10% of your interest)

In 2020 we will only get a quarter of 20% of the interest.

aspasp1 · 12-02-2020 2:27pm

BBMcQ wrote: »

Folks, I think it’s super important to highlight because 9 out of 10 ppl don’t know this

ALOT of the times it will make sense for you to break out of a bad fixed rate deal. Some people thing you are stuck in a fixed rate deal no matter what.

We got AIB down from a near 5k breakage fee down to near 900! Now Ulster bank aren’t charging us anything to switch from their 2.6% fixed to 2.2% fixed. EU rules mean that a bank can only charge you a break fee based on what it would cost them to finance the remaining principle plus admin costs. AIB in particular weren’t following this until approx July 2019.

It’s staggering to think of the amount of money out there being overpaid to banks on mortgages....

Also 1500 all-in is the target price for a solicitor to switch. You don’t even need to meet them so I wouldn’t pay more for one just because their office is in D4.

Hi, we are only 1.5 years into mortgage with ulster and locked it for 4 years @2.6%. Do you think we should ask them if we can be moved to 2.2%.

Cyrus · 12-02-2020 3:33pm

aspasp1 wrote: »

Hi, we are only 1.5 years into mortgage with ulster and locked it for 4 years @2.6%. Do you think we should ask them if we can be moved to 2.2%.

ask of course, the run the calcs to see if it makes financial sense in the context of the breakage fee and interest saving

aspasp1 · 12-02-2020 4:00pm

Cyrus wrote: »

ask of course, the run the calcs to see if it makes financial sense in the context of the breakage fee and interest saving

Thanks Cyrus..Anyone want to share their recent experience in dealing with Ulster on something similar?

Cyrus · 12-02-2020 6:51pm

aspasp1 wrote: »

Thanks Cyrus..Anyone want to share their recent experience in dealing with Ulster on something similar?

there really isnt anything to it

call them up, say you are interested in moving rates and ask them if they can send out your break fee if you are to do so,

you will get a letter 5 days later with the options.

chases0102 · 13-02-2020 11:25am

Just related to this - I did that during the summer, and the fee was outrageous. 18 months into 5 year fixed.

Can the figure drastically change, or would I be wasting my time ringing them again (BOI).

Thanks!

bazz26 · 13-02-2020 3:03pm

The breakage figure changes constantly so yes ring them again.

BullBauld · 14-02-2020 11:54am

Sent off a change of interest rate request with BOI.
Currently on 5yr 3.1% <60% LTV.

So got offered 5 different options from 1yr 2.9% to 10yr 3.3% and a few in between.

Only one option gave a saving of a whole €5!

So will look elsewhere. Although looking to get a substantial loan for a wedding soon enough so that might hold things off for a bit.

Mortgage - low fee for breaking fixed rate

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