Worth changing mortgage to save €1000pa?

M

Mommah

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My existing mortgage (280k) is at 4.95%
I notice the National Irish Bank is offering 4.6%+will pay switching costs.
The net difference I think is €1013 per annum.
Is is reasonable to change mortgages for this differential??

We are potentially facing a negative change in circumstances (30% chance it will happen) and trying to tighten our belts....but also feel that a solid relationship with our exisiting provider might be a good thing (ie worth more than €1013 pa???)
 
With negative equity, you may have a non-runner to begin with, but call the bank and find out.

The 4.61% on their website seems to apply to LTV of 60%.
 
Sam h the poster referred to a negative change in circumstances (perhaps one of you stopping work?) and not negative equity.

I don't have a huge amount of knowledge in this area but my impression is that relationships with lenders aren't as useful as they used to be. Bank's have strict credit criteria and tend to stick to them so I'd say move unless of course the National Irish Bank offer is only an introductory one and will change after a year.
 
Be careful of lenders quoting discounted rates for the first year. You could end up losing in the long run if the rate applicable form year 2 on is higher than your current rate.



Emmet Pullan

[broken link removed]
 
Would agree value of relationship not the same as in the past as the computer credit checking seems to be what matters now.
 
EmmetP said:
Be careful of lenders quoting discounted rates for the first year. You could end up losing in the long run if the rate applicable form year 2 on is higher than your current rate.
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NIB's rates are not discounted - they are the rates for the full term.

Is it worth it for 1000 a year - of course it is. How long will it take you - maybe 3 or 4 hours at most. No cost and 1000 a year - 10K over 10 years. You'd be a long time putting money in the savings account to earn that much.
Why let the more expensive lenders expand their profits even more.
If you plan to move do it very soon - NIB have hinted at rises soon.
 
Apoligies Saudi....you're right (I misread it).

I'd agree with everything else suggested....long term relations mean very little to the banks these days.
If you change to NIB, you'll save the €1000 pa + if your circumstance allow, you could always use this extra money to offset on the mortgage to help you save even more! Paying off lumpsums and upping you monthly repayment amount can substanially reduce the term of your mortgage and save you a small fortune.
 
€1,000 per year saving? That is a no brainer- especially if you have 5 or more years left on the mortgage.

If you could save €1000 per year on your car insurance would you change?

This "loyalty" phenomenon to one's bank must be a purely Irish thing, probably why they get away with so much. Have no doubt in your mind that "loyalty" is not the buzz word in your bank, PROFIT is what their about.
 
Worth changing mortgage to save €1000pa?
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Yes - of course. Unless you habitually like to give away money unnecessarily. In which case I can send you on my bank account details so you can lodge as much as you like.
 
Thanks folks

I guess I'm considering the long term also and its likely that often there will be better rates available than the one you are on....so

How frequently can one justify changing mortgages.
What margin justifies the change?
Is there any downside??

This mortgage is only 3 yrs old.
 
It all depends on what value people place on their time and a bit of hassle. But personally if I could - after all legal expenses and valuation fees - save more per year than I could earn in a week I would make the change. Once you have moved to the best tracker rate (especially if it is a tracker) it will probably become less likely that you will find a better rate.
PS I assume your mortgage outstanding is under 80% of the house value - (if it isn't NIB will be no good for you)
 
irishlinks said:
It all depends on what value people place on their time and a bit of hassle. But personally if I could - after all legal expenses and valuation fees - save more per year than I could earn in a week I would make the change. Once you have moved to the best tracker rate (especially if it is a tracker) it will probably become less likely that you will find a better rate.
PS I assume your mortgage outstanding is under 80% of the house value - (if it isn't NIB will be no good for you)
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Yep that amount €1013 is net of legal fees and I earn SFA (very hard on profanity on this site..so to clarify that is Sweet Fanny Adams) per week as a SAHM so...definitely more than I earn :D
The mortgage is under 80% but I'm not sure if its a tracker...will check out thanks irish!
 
Yep it is a tracker but it doesn't seem to say at what level above the ECB rate

Quote NIB website "Our ECB LTV Tracker Mortgage is a variable rate mortgage."

Can one assume it maintains the current gap for the duration??
 
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