# Mortgage payment has gone up following increased TRS in Budget, why?



## MelF (30 Dec 2007)

Got a letter from my building society telling me that my mortgage repayment will be INCREASED following the budgetary changes to TRS! How is this possible? Old repayment 1270, new repayment 1276.07. I know its only a couple of quid but shouldn't it have decreased?
Very confused.....


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## ClubMan (30 Dec 2007)

You'd need to post more details - e.g. original mortgage amount, term, and start date; outstanding amount and term; rate (maybe the rate has gone up?); single or joint buyer; first time buyer in first 7 years of mortgage or other, etc.?


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## MelF (31 Dec 2007)

No mention of the rate having gone up, the letter states categorically that this is as a result of budgetary changes which is what confuses me most. We are joint buyers in the ninth year of mortgage and outstanding amount is 270,000 over with 21 years left on a thirty year term.


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## ClubMan (31 Dec 2007)

Could it be that up to 2007 you were paying more than €6,000 interest annually (€6K is the maximum amount qualifying for relief for married/joint owner occupiers who are not FTBs or are in the 8th or later year of their mortgage) but in 2008 your annual interest bill will fall below this so you will be getting less mortgage interest relief overall and your total repayment will rise?


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## Raskolnikov (2 Jan 2008)

ClubMan said:


> You'd need to post more details - e.g. original mortgage amount, term, and start date; outstanding amount and term; rate (maybe the rate has gone up?); single or joint buyer; first time buyer in first 7 years of mortgage or other, etc.?


Like ClubMan says, we need to know the exact details of the mortgage you're holding before we answer your question.


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## Brendan Burgess (2 Jan 2008)

Is your mortgage with the Irish Nationwide? 

They are making a systematic error in their calculations of repayments for those with arrears. 

They recalculate the repayment due whenever there is an event, TRS change, interest rate change, capital repayment etc. 

So they send bizarre letters to customers telling them that as a result of the recent reduction in interest rates, their new repayment is €x. And €x is higher than the old repayment. 

Brendan


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## ClubMan (2 Jan 2008)

Brendan said:


> Is your mortgage with the Irish Nationwide?


 Ah - maybe the clue was in the question alright. Presumably must be either _EBS _or _INBS _if this is accurate:


MelF said:


> Got a letter from my building society ...


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## MelF (2 Jan 2008)

Yes, it is Irish Nationwide!!! But we are not in arrears or anything. Will give them a buzz now that they are back and find out once and for all......


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## Luckycharm (2 Jan 2008)

Did you get a reply - I just noticed mine went up €8 as well with Ulster bank would not have noticed if not looked at this thread will have to ring them tomorrow.


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## ClubMan (2 Jan 2008)

Luckycharm said:


> Did you get a reply - I just noticed mine went up €8 as well with Ulster bank would not have noticed if not looked at this thread will have to ring them tomorrow.


What are your mortgage details - original amount and term, outstanding amount and term, rate, single or joint mortgage holder, FTB in first 7 years of mortgage or not etc.?


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## Luckycharm (2 Jan 2008)

NOt giving out all the details basically FTB over 30 yrs am in 4yrs - joint mortgage holder married no reason it should have increased will contact bank tomorrow to find out.


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## ClubMan (2 Jan 2008)

Luckycharm said:


> NOt giving out all the details


Fair enough but that means that people cannot attempt to explain the seeming discrepancy of your repayment going up by €8.


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## Luckycharm (2 Jan 2008)

ClubMan said:


> Fair enough but that means that people cannot attempt to explain the seeming discrepancy of your repayment going up by €8.


 
Hence I was asking the original poster what his mortgage provider said  Anyway it is far too much that I really would not have noticed if I had not read this thread.


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## TonyD (2 Jan 2008)

Luckycharm said:


> NOt giving out all the details basically FTB over 30 yrs am in 4yrs - joint mortgage holder married no reason it should have increased will contact bank tomorrow to find out.


 
What ye hear back...?


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## Luckycharm (3 Jan 2008)

I think I got my Tax relief sorted last year as the missus was not down as a 1st time buyer and they divved it out over last year so they have put it back to the normal rate for this year which is fair enough as I say it is only €8.


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## Jadesq (26 Dec 2008)

Our mortgage repayment has increased too and we have a 30 yr €295k tracker mortgage with First Active, which just started in Aug this yr. Our recent repayments have gone from €1,041 to €1,147. I phoned FA to enquire about it and they said our monthly mortgage repayment HAD decreased, but the amount of TRS relief had decreased following the recent budget changes, and this had caused our overall repayment to increase. The customer service rep I spoke to had no more info about exact TRS changes but said that all their queries were due to this in recent weeks, and referred me to the revenue website. On revenue.ie all I can see is that in fact the budget 2009, increased TRS from Jan '09 for FTB from 20-25% in yrs 1&2 and also increses to 22.5% in yrs 3,4 and 5. Yrs 6&7 remain at original rate. So I think I will have to ask our bank more about it.


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## daxve (27 Dec 2008)

In answer to the OPs origianl query the rate of TRS has been cut from 20% to 15% in the budget for anyone that has there mortgage more than 7 years this is why your payments have increased.

http://www.revenue.ie/en/tax/it/leaflets/tax-relief-source-mortgage-interest-relief.html#section8


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## krattapopov (6 Jan 2009)

Hi, 
If I could jump in here I have a query of my own in relation to this.. myself and my partner are FTB's and bought in December 07, details are:
370k
35 years
5.25%
Fixed 3 years
Repayments are €1926 with Ulster

Now we got a notice in December stating that our TRS has dropped from approx €350 to €315

Now from using Karls Calc and what the revenue says about TRS I thought the relief would go up? And that the new relief payments should be around €400 (25% * 1600 _interest_)

Am I wrong in working this out or should I get onto the bank?

Thanks for Any help given


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## karibou57 (6 Jan 2009)

Similar situation we bought a house at 295k in september 2007. Rate is fixed for 5 years. Repayment post TRS was 1318 and it went up to 1321 when I was thinking it would go down with the new budget! Any idea?


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## rameire (6 Jan 2009)

TRS rates changes announced in the October 2008 Budget statement are effective from 1st January 2009.
Some lending institutions were not in a position to implement these changes for technical reasons but have indicated they will be in a position to do so shortly. This may account for an incorrect rate of relief being granted in the short term, which lenders have undertaken to rectify at an early date. 

karibou57 even though you are on a fixed rate your repayments may have increased by 3 euro, as your balance of the mortgage has decreased over the last 1 and a half years thus meaning the interest you pay going down, so you would be entitled to less trs.


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## LadyJane (7 Jan 2009)

Ulster Bank's notices of TRS that went out at the beginning of Jan did NOT take into account the budget increases in TRS for first time buyers.

We are in to year 2 of a 35 year mortgage. Ulster Bank sent us notification of our TRS at the beginnig of Jan. Our repayments had gone UP by 4 euro a month. When I rang the Ulster Bank Mortgage Advice Centre, the guy said that this did not take in to account the bugetary changes and that this would be changed over the next few months and adjusted back to January. So the notices are standard ones they send out at the beginning of the year and had nothing to do with the budget changes.

Perhaps other lending institutions are also slow to take up or apply the budget changes to TRS. I think sometimes it saves a lot of time and speculation to just ring up your lender and find out what the story is... although I do think it is a bit silly that they couldn't just get the correct rate at the beginning of the year.


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## rameire (7 Jan 2009)

LadyJane said:


> although I do think it is a bit silly that they couldn't just get the correct rate at the beginning of the year.


 
trust me, its not that simple, 
software has to be rewritten, then tested, then run in a test environment usually over a period of 12 cycles, (12 months) this has to be then evaluated, checked , double checked and then implemented, this takes about 2 to 3 maybe 4 months, 
it used to be just 20% of the ceiling or interest paid whichever was lower, now its a few different rates.
but any trs due will be refunded, so if you are due more trs, at least it will mean lower repayments towards the end of the year.


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## LadyJane (8 Jan 2009)

rameire said:


> trust me, its not that simple,
> software has to be rewritten, then tested, then run in a test environment usually over a period of 12 cycles, (12 months) this has to be then evaluated, checked , double checked and then implemented, this takes about 2 to 3 maybe 4 months,
> it used to be just 20% of the ceiling or interest paid whichever was lower, now its a few different rates.
> but any trs due will be refunded, so if you are due more trs, at least it will mean lower repayments towards the end of the year.



That's cool, I can spare the 4 euros a month, just.  Just idle speculation, but I wonder if the rate change benefited the banks, ie put money in their coffers, if the change wouldn't have been applied from 12.01am January 1st, 2009! Something tells me they would have found a way...


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## 007007 (8 Jan 2009)

im in the same position, i got a letter from First Active to say my trs has decreased and my mortgage has increased by about EUR20 per month.

this is about my 3rd letter since i took out the mortgage Dec 07.  Mortgage of EUR200,000 is fixed for 5years, think the rate is 5.4%.  I spoke to the bank and they said to contact the Revenue...


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## WHAT'SFREE? (9 Jan 2009)

I am a FTB since December 2005 and following the budget announcements, I expected my mortgage interest relief to increase from this month onwards.  

However, I noticed that the amount of relief I received in January had actually decreased from €170 odd to €140.

I rang my mortgage provider (AIB) and they couldn’t explain why this had happened.  The figures didn’t add up to any of the percentage changes announced in the budget and suggested perhaps Revenue mistakenly had me down as a non-FTB and told me to contact them.

This I duly did and I was told by Revenue, although this is the first time I’ve ever actually noticed, that each year since I’ve been receiving TRS the amount I’ve received in January has been significantly lower (only €30 in one year!).  The chap in Revenue suggested it may be that the bank estimates the amount of interest on the mortgage that will be payable during the year and then balances the figures in January.  

Maybe this info might be of some help to others…


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