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Mortgage - low fee for breaking fixed rate

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  • Registered Users Posts: 600 ✭✭✭bobbyg


    Summer8181 wrote: »
    Just off the phone to EBS, breakage fee is over €3600 and only valid for 5 days. How do they get away with this. I only want to pay lump sum. Have 18 months left on fixed term.

    Ask them to send you a letter to confirm the amount with the calculation. I was told the same thing last year, 1 year into a 4 year fixed rate. When I received the letter the breakout fee was calculated at 0. It was a different bank but I know of others who were told high amounts on the phone only to receive a much lower (if not zero) amount on the letter.


  • Registered Users Posts: 19,547 ✭✭✭✭Cyrus


    Summer8181 wrote: »
    Just off the phone to EBS, breakage fee is over €3600 and only valid for 5 days. How do they get away with this. I only want to pay lump sum. Have 18 months left on fixed term.

    breakage fee will be on the full amount of the mortgage, assume the lump sum is lower, so it will be pro rata


  • Registered Users Posts: 55,431 ✭✭✭✭Mr E


    Summer8181 wrote: »
    How was it free? Were you leaving or paying a lump sum?

    Not at all. I just called them up and she put me on hold while she spoke to the mortgage loans team. 30 second later, she came back on and said the breakage fee (at the moment) was 0.

    After reading the horror stories about breakage fees in this thread, I was as suprised as you are.


  • Registered Users Posts: 51,059 ✭✭✭✭bazz26


    Some good information here around breaking fees and penalties:

    https://www.askaboutmoney.com/threads/understanding-fixed-rates-breakage-costs.204427/


  • Registered Users Posts: 113 ✭✭Summer8181


    Anyone know how ebs calculates breakage fee? 3.15 is the rate, 98k is amount out standing and 141 payments left. 18 months still left on fixed contract

    98k is to closest thousand
    3600 is to closest hundred

    That is as much as they would tell me over the phone.


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  • Registered Users Posts: 17,055 ✭✭✭✭Tusky


    Mr E wrote: »
    I called EBS yesterday. 14 years into my mortgage, 1 year into a fixed term. Breakage fee was 0.

    Tempted to move to AIB - my current account and CC are there, they pay 2k towards the legal fees and they have an option of a 6 month moratorium on mortgage payments.

    My car is on its last legs (probably won't pass NCT in September) so I'm seriously considering a move - the moratorium would really help with the process of getting a new car.

    On the moratorium - just be aware that interest continues to acrew during the six months.


  • Registered Users Posts: 2,176 ✭✭✭jiltloop


    Del007 wrote: »
    I stupidly didn't ask the solicitor how much it would cost. I used the same guy who I used to buy my house 2 years ago. I just presumed it would have been a cheaper fee than that. It was indeed a hassle!

    €2,300 solicitor fee for switching is crazy, we were charged half that by our solicitor earlier this year for our switch.

    Sounds like the solicitor wanted a chunk of your cash back. Wouldn't be surprised to start hearing of solicitors upping the fees of a switch to try and benefit from the cash backs people are taking advantage of.


  • Registered Users Posts: 113 ✭✭Summer8181


    Shop around


  • Registered Users Posts: 7,729 ✭✭✭Millem


    Just requested a new breakage fee from AIB.


  • Registered Users Posts: 3,663 ✭✭✭JoeyJJ


    bazz26 wrote: »
    Some good information here around breaking fees and penalties:

    https://www.askaboutmoney.com/threads/understanding-fixed-rates-breakage-costs.204427/

    Some good info there thanks..

    Alot of talk about moving etc, however would breaking cost be Zero if you just want out of fixed deal and remain in the same bank. For example if Ireland had a proper competitive system and some German banks came in and BOI reduced their fixed a few points and I didn't want to go through robbing solicitors


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  • Registered Users Posts: 1,584 ✭✭✭Del007


    jiltloop wrote: »
    €2,300 solicitor fee for switching is crazy, we were charged half that by our solicitor earlier this year for our switch.

    Sounds like the solicitor wanted a chunk of your cash back. Wouldn't be surprised to start hearing of solicitors upping the fees of a switch to try and benefit from the cash backs people are taking advantage of.

    It was €1,200 for the same solicitor when I bought the house less than 3 years ago and he had to deal with the council then so it was more work for him. I was shocked when he nearly charged me double


  • Registered Users Posts: 547 ✭✭✭Q&A


    JoeyJJ wrote: »
    bazz26 wrote: »
    Some good information here around breaking fees and penalties:

    https://www.askaboutmoney.com/threads/understanding-fixed-rates-breakage-costs.204427/

    Some good info there thanks..

    Alot of talk about moving etc, however would breaking cost be Zero if you just want out of fixed deal and remain in the same bank. For example if Ireland had a proper competitive system and some German banks came in and BOI reduced their fixed a few points and I didn't want to go through robbing solicitors

    Break fee is a function of banks borrowing costs. Has nothing to do with their lending rates. You could do as you say break and refix at a lower rate. No change of bank so no solicitors fees. However some may require a new valuation.

    Some people have already done this. For example, BOI lowered their fixed rates about 18 months ago -only by something like 0.25% if even that - cost €30 to break but is saving them €30 a month now.

    Alternatively you can break and refix thereby extending your period of fixation. Ulster Bank is a good example they don't do traditional x year fixes. All their rates tend to be set until September 202x. Depending on when you fix you could turn a 2.3% 2 year fixed into an effective 4 year fixed at the same rate.


  • Registered Users Posts: 5,494 ✭✭✭baldbear


    With Aib @2.95 variable rate. They have a 3 yr fixed for 2.85%.

    We have just started the process of going to Ulster bank @ 2.3% fixed for 2 years. There legal fee offer will cover solicitor costs & they cover valuation cost. We will save €85 a month.

    We are using a mortgage broker this time.

    We are going to treat our mortgage like a gas bill from now on. Switch rates, change bank.
    In 2 years we will switch again or move to another fixed rate with UB. I can't see rates rising before then. But heah who knows?:)


  • Registered Users Posts: 1,584 ✭✭✭Del007


    baldbear wrote: »
    With Aib @2.95 variable rate. They have a 3 yr fixed for 2.85%.

    We have just started the process of going to Ulster bank @ 2.3% fixed for 2 years. There legal fee offer will cover solicitor costs & they cover valuation cost. We will save €85 a month.

    We are using a mortgage broker this time.

    We are going to treat our mortgage like a gas bill from now on. Switch rates, change bank.
    In 2 years we will switch again or move to another fixed rate with UB. I can't see rates rising before then. But heah who knows?:)

    Did you get a quote from your solicitor?


  • Registered Users Posts: 51,059 ✭✭✭✭bazz26


    Ulster Bank pay a maximum of 1500 towards solicitors fees so be careful there.


  • Closed Accounts Posts: 4,121 ✭✭✭amcalester


    Del007 wrote: »
    It was €1,200 for the same solicitor when I bought the house less than 3 years ago and he had to deal with the council then so it was more work for him. I was shocked when he nearly charged me double

    I don’t know why I think this but I think solicitors are required to issue an estimate of potential charges.

    Might be worth looking into. And get a breakdown of the charges so you can see what you’re paying.


  • Registered Users Posts: 13,584 ✭✭✭✭mrcheez


    Would a mortgage broker be a good way to judge best options out there taking into account the solicitor fees, and what would be covered etc?

    Roughly how much would one lose using a mortgage broker over just doing all the research/work yourself (or does the bank just pay the mortgage broker whatever for bringing your business)?


  • Registered Users Posts: 547 ✭✭✭Q&A


    mrcheez wrote: »
    Would a mortgage broker be a good way to judge best options out there taking into account the solicitor fees, and what would be covered etc?

    Roughly how much would one lose using a mortgage broker over just doing all the research/work yourself (or does the bank just pay the mortgage broker whatever for bringing your business)?

    Think most brokers get paid by the bank, some may charge client not 100% sure.

    TBH it's not like there are a multitude of mortgage providers in Ireland. Bonkers.ie is as good a place as any or head over to askaboutmoney.com.

    Ultimately what is best will depend on your circumstances. General rule of thumb if mortgage is not going to be a burden and you're looking to pay it off super fast then maybe focus more on cashback. If it's going to go full term interest rate is maybe more relevant. Factor in multiple switches and it's a case of ordering the cashback in the right way so as to start with the highest cashbacks and end with the best rate.

    No harm giving it a go yourself. You're the best person to know what you want.

    Remember it's the life time cost of your mortgage you want to minimise so you might be better going for a longer fixed at a higher rate if you think rates will rise over the medium term.


  • Registered Users Posts: 43 poolfandar


    4 years left from 5 year fixed with UB. Almost 3k break fee. Sent a letter challenging this but just got the same ' 6 month interest' letter back!

    They don't seem to be following the new central bank rules!!


  • Registered Users Posts: 45,176 ✭✭✭✭Bobeagleburger


    I’d hate to switch just to line the pockets of a solicitor with all the hassle involved. I thought €1000-€1200 was the average solicitor conveyance fee??

    KBC gave me 3k to switch. Total fees were 1500.

    1500 left over for us


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  • Registered Users Posts: 13,584 ✭✭✭✭mrcheez


    bazz26 wrote: »
    I'm currently with BOI so they won't give it to me to stay with them, only new customers. The best BOI will do for me is 2.8% instead of the advertised 2.9%.

    I checked with BOI but they are flatly denying that a 2.8% rate exists.

    How the hell did you manage to get 2.8% instead of 2.9? :)


  • Registered Users Posts: 51,059 ✭✭✭✭bazz26


    mrcheez wrote: »
    I checked with BOI but they are flatly denying that a 2.8% rate exists.

    How the hell did you manage to get 2.8% instead of 2.9? :)

    That's what they came back to me with after I told them I was thinking of switching and shopping around for the best deal.


  • Registered Users Posts: 13,584 ✭✭✭✭mrcheez


    bazz26 wrote: »
    That's what they came back to me with after I told them I was thinking of switching and shopping around for the best deal.

    I'll give it a shot. Don't suppose 2.8% is printed anywhere online?


  • Registered Users Posts: 51,059 ✭✭✭✭bazz26


    Don't think so, I assume it was just a discounted rate offered to stay with them. I didn't follow up with it in the end as the break fee outweighed the savings for the bones of 12 months so I'm going to let my current fixed rate term run down a bit more and keep an eye on other offers out there.


  • Registered Users Posts: 24,211 ✭✭✭✭lawred2


    mrcheez wrote: »
    I checked with BOI but they are flatly denying that a 2.8% rate exists.

    How the hell did you manage to get 2.8% instead of 2.9? :)

    I was offered that back in Jan to stay with them. Still switched to ptsb for the same rate plus the cashback


  • Registered Users Posts: 13,584 ✭✭✭✭mrcheez


    lawred2 wrote: »
    I was offered that back in Jan to stay with them. Still switched to ptsb for the same rate plus the cashback

    Was that also after telling them you were thinking of switching?


  • Registered Users Posts: 24,211 ✭✭✭✭lawred2


    mrcheez wrote: »
    Was that also after telling them you were thinking of switching?

    hmmm I'm fairly sure I mentioned PTSB alright but can't be sure on whether that was before or after 2.8 was offered


  • Registered Users Posts: 63 ✭✭barrystealover


    I am about to purchase a house for 355k(incl stamp duty). I have a deposit of 100k therefore only need a mortgage of 255k ish.

    Could someone advise me of the best Mortgage provider to go with and the best time period to fix it for?

    I am approved with ptsb for 2.9% 3 yr fixed with 2% cashback of the mortgage amount. I have compared this to other 3 years and over the 3 year period this is the lowest repayment when u take into account the cashback.

    Anyone know is a 3 yr fixed a good idea?


  • Registered Users Posts: 1,115 ✭✭✭BigAl81


    Anyone know is a 3 yr fixed a good idea?

    You can take the cash back and "three year fixed" deal, then switch away in a year for free for a better rate, or even more cash back with another bank ;)

    Source: I got 17k cashback in 13 months :D


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  • Registered Users Posts: 5,683 ✭✭✭masterboy123


    I am approved 3% fixed for 5 years with PTSB and 2% cashback on mortgage amount + 2% cashback on monthly mortgage amount.
    Will try to switch after a year and see what's better in the market.
    I am approved with ptsb for 2.9% 3 yr fixed with 2% cashback of the mortgage amount. I have compared this to other 3 years and over the 3 year period this is the lowest repayment when u take into account the cashback.

    Anyone know is a 3 yr fixed a good idea?


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