Tracker or Variable?

A

Angel28

Guest
Which option is better to go opt for a Tracker or Variable Rate Mortgage? Is it likely that a Tracker might end up costing more in the long run?
 
You only get a Tracker when you get over €250,000 from banks,it is at a discount rate as well afaik. The tracker is on a variable rate also but if the ECB raises rates next day so will your repayments go up to.
 
You only get a Tracker when you get over €250,000 from banks


This is true for EBS for example, but Bank of Scotland give trackers for less than 250,000..

you need to ask the banks individually..
 
Sorry, meant to add, that the tracker will always be a specific limit over the EBS, eg, 0.5% or it will match it, whereas a variable rate is just set at whatever rate the bank feel like setting it...

therefore, a tracker will go up/down along with European Central Bank rate, whereas the variable may not change... eg, Bank of Ireland held back interest rate increases on their variable rate during the year when ECB rates rose..
 
Many tracker rate mortgages offer good value. It all depends on the size of the margin over the ECB rate.

Example: the best SVR (standard variable rate) on the market at the moment is 4.35 I think.

I was on NIB's 0.79% tracker, meaning I paid the ECB rate of 3.25 + 0.79 = 4.04%. Good value.

I am now moved onto NIB's new LTV mortgage, with an even lower fixed margin of 0.50% over the ECB rate. Great rate.
 
hi, can you make early repayments on a tracker mortgage as in a variable one?

cheers
m
 
Yes. Under the Consumer Credit Act lenders cannot impose penalties on owner occupiers who want to accelerate the repayment of variable (including tracker) rate mortgages. Some lenders may set a minimum lump sum amount (e.g. €1K or more) that will be accepted.
 
Sarah W said:
Yes - you can pay off lump sums on any variable or tracker mortgage without penalty.

Sarah

www.rea.ie
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can you do this by just say walking in to the bank with a lump sum at any time or do you have to get some forms signed to set it up through the mortgage account
 
manukev said:
can you do this by just say walking in to the bank with a lump sum at any time or do you have to get some forms signed to set it up through the mortgage account
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You should be able to do it on demand but it might make sense to arrange in advance rather than arrive with a wad of cash just in case. Also put your instructions in writing so there is no confusion. For example make sure that you clearly state that any overpayment (regular or lump sum) is to be paid off the capital outstanding and not lodged as a credit on your account in which case it might not reduce the capital balance outstanding (unless it's an offset or current account mortgage).
 
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