Mortgage change from home to investment

[apintofplain]

Hi,

Apologies if this has been asked already but I couldn't find a similar question.

Over ten years ago I took out a annuity mortgage with KBC as a first time buyer for a new home. Recently I've moved from there and started renting the house out while renting a different property in a different location myself, circumstances changed. After talking to KBC about trying to get the current account mortgage discount KBC asked me to send them a letter to change the mortgage type to investment which I did.

I'm still on a 4.25% variable rate but now see the value in switching to a 2 or 3 year fixed on a lower rate. Am worried if I "rock the boat" they might end up switching me to a buy to let rate which is much higher as I'm no longer an owner occupier. Examined my mortgage contract and to my untrained eyes it seems to state that the rate is related to the mortgage type.

It must be a fairly common situation so just wondering what's my best next steps.

 

[Brendan Burgess]

KBC asked me to send them a letter to change the mortgage type to investment which I did.

I don't like the sound of that. They asked you to do something and you agreed without questioning why!

They will now say that you asked for an investment mortgage and will charge you accordingly.

You need to review whether it is worth holding on to this investment. At a rate of 4.25% which might now be increased, it is unlikely to make financial sense. Unless you intend to return to it. If you do intend to return to it, you should tell KBC immediately and request that it not be classified as an investment property.

KBC recently introduced LTV mortgages for home loans. What is the value of your home? How much is outstanding on your mortgage?

Brendan

 

[SirMille]

Changing from home to investment, did this happen because you changed your correspondence address?

 

[apintofplain]

Changing from home to investment, did this happen because you changed your correspondence address?

Exactly

I don't like the sound of that. They asked you to do something and you agreed without questioning why!

I changed it as I opened a current account with them to try to avail of the KBC current account discounted rate and wanted my new rental address on the account and not the mortgage address. Customer service advised me that I needed to change my mortgage type for this to happen.
In hindsight, I should have looked more into this before sending off that request but I didn't think much about it and was not advised that this would affect my mortgage rate. I was initially advised I was eligible for the discount and then in the end they declined my request to due to the change in mortgage type so it did feel a bit like entrapment.

The apartment is worth approx €250k and I've €240k left on the mortgage. I've no plan to move back in there, the apartment is in Dublin and I've relocated out of Dublin.

Yes I just saw the LTV mortgage, unfortunately "Customers with investment or pension back mortgages cannot avail of the offer"