Key Post Analysis of new ptsb tracker mover

ptsb has announced its various products for people who wish to move house

The Home Movers Guide is a 45 page tome. I have attached the two Key Examples to the posts below.

Here is a summary of to whom it applies:

• It is not for people who are in arrears or struggling. You can apply only if you have not been in arrears or if you have not rescheduled your mortgage over the past two years.
• It provides options for those with cheap tracker mortgages in negative equity
• It provides options for those with cheap tracker mortgages and positive equity
• It provides options for those with SVR and negative equity (covered here: New ptsb negative equity mortgage - SVR)
• Borrowers with SVR and positive equity don't need a new product. They can sell their home and get a new mortgage with ptsb or with another lender

Here are the Key Features of Cheap Tracker switches, positive or negative equity

• Applies to family home only
• You must have 10% of the purchase price of the new property, but this can come from the positive equity in your existing home.
• The maximum LTV is 125% of the new property
• You transfer the full existing mortgage to the new property but the rate is increased by 1%
• The term remains the same for the exisiting tracker
• If you need an additional mortage, it will be at the new business rates e.g. 5.1% variable on LTVs in excess of 90%

There is a calculator on the ptsb website which willwork out how much you need and what the repayments will be. However, it doesn't tell you what earnings are required for a mortgage of this size.

Conditions for Tracker portability

Note: Tracker Portability is only available to existing permanent tsb customers with permanent tsb home loan Tracker Interest Rates who are moving home.

• This offer is only available to existing mortgage customers whose account(s) are operating in order as set out in the terms and conditions of their mortgage and have not been in arrears or availed of an alternative repayment arrangement in the past 24 months as a means of helping with repayment difficulties.
• The existing property and your new property must be your family home.
• When choosing a Tracker Portability Mortgage, you must pay a deposit of a minimum of 10% of the new property’s purchase price.
• You must have sufficient funds to pay all costs, including stamp duty, legal fees, estate agent’s fees, etc. These cannot be deducted from the sale proceeds of your existing property if you are in Negative Equity.
• For customers who are in Negative Equity and want to trade up (i.e. where the total loan amount has increased), a maximum Loan-to-Value (LTV) on the new property of 125% applies.
• For customers who are in Negative Equity and want to trade down (i.e. the total loan amount will decrease), a maximum LTV on the new property of 175% applies.
• The maximum total loan amount for a trade-down mortgage is €550,000.
• You can move home and keep the Tracker Interest Rate that applies to your Primary Mortgage plus an additional 1%. As you are aware, your Tracker Interest Rate is made up of the ECB rate + a Margin. For the purposes of Tracker Portability, the Tracker Interest Rate that will be transferred will not include any adjustments that have been applied to the Margin since the current tracker rate product was set up on the Primary Mortgage. If you currently have more than one mortgage on a Tracker Interest Rate, the “Tracker Portability” Rate will be based on the Tracker Interest Rate on the Primary Mortgage.
• The maximum term you can avail of is the current term remaining of the Primary Mortgage (term will be rounded up to the nearest year).
• If you are trading up and need additional funds to purchase the new property, these funds will be offered at home loan New Mortgage Business rates. The new funds borrowed are a separate loan and, together with your Tracker Portability Mortgage, will be known as a “Tracker Portability Split Mortgage”.
• The maximum term available for additional funds borrowed is 35 years subject to an upper age limit of 70 for the oldest applicant at loan maturity.
• The minimum total loan amount is €40,000 (this includes the Tracker Portability loan amount).
• Repayments will be capital and interest.
• A Tracker Portability facility is only available for six months after the sale of your existing property, subject to having a Letter of Approval.
• The purchase of the new property is expected to take place on the same day as the sale of your existing property, but no later than six months afterwards.
• You can only avail of Tracker Portability once and it can only be used on one property.
• If you are in Negative Equity, all of the sale proceeds of the existing property must be used to reduce your existing mortgage debt.
• This is a limited offer subject to available funding.

The purchase of the new property and the sale of the existing property should happen on the same day, with the sale of your existing property happening first. If there is an unforeseen event which makes it impossible to close both the sale and the purchase on the same day, the Shortfall Repayment Agreement you signed as a pre-condition of receiving your Letter of Approval comes into effect. This is an agreement that shows the amount of money still owed on the existing mortgage after the sale of the existing property takes place (i.e. the Negative Equity). Until you purchase the new property, we will apply a capital payment holiday to your account so that your monthly payment is interest only. However, this shortfall amount must be repaid in full no later than six months after completion of the sale date of your existing property. The new mortgage will be used to repay the shortfall amount.

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and just in case, this is not clear enough, it is highlighted in bold later in the brochure

The availability of Tracker Portability is valid for up to six months from the date of completion of the sale of the Existing Property. Where six months has elapsed from the date of completion of the sale date of the existing property, the Letter of Approval will expire immediately and the shortfall amount including any interest will have to be repaid in full at that time.

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Case study of tracker mortgage and negative equity ( summary of attached case study from Page 32)

Current mortgage
Buying the new house

Tracker and positive equity - see attached case study

Current mortgage
The customer wants to buy a house for €250,000 so he needs a 10% deposit, or €25k. This can come from the positive equity released on the sale of the property.




Buying the new house
Surplus cash available: €25k


It's a bit stupid to trade up for only €30k of extra house ( €250k - €220k)
You pay 1% extra on the tracker which is €1,700 a year.
You pay all the expenses of moving.
You use up your one permitted tracker transfer

It would only make sense if you were relocating and you could buy a house for roughly the same price that your current house is worth.

Brendan Burgess said:

Conditions for Tracker portability
• The existing property and your new property must be your family home.

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My wife & I have just been refused this offer - after having dealt with the local branch since March (it seems the branch is totally clueless, but that's another post).

My wife owns an apartment - with a PTSB tracker mortgage.
I own an apartment - with a PTSB variable rate mortgage.
Both bought separately - before we met and got married.
Both in positive equity. You'd think we were exactly the type of people they hoped to attract with this offer.

Our plan was to sell both, buy a new house and part avail of the tracker offer (for the amount left on the current tracker mortgage).

The reason for declining our application?
We've lived in the wrong apartment. My wife's apartment has been rented out the last few years....