AIB & interest only on mortgages

M

moneyhoney

Registered User
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Hi everyone,

Does anyone know if AIB will allow you to go on interest only/take a mortgage break for 6-12 months? I'm not having trouble repaying the mortgage - just something else I want to do that would be easier if I could do the above. Easier to have some idea before approaching them. Have mortgage 5+ years.

Thanks.
 
If you ring AIB to ask them that question, you can expect to be told to write them a letter outlining your circumstances, and that they will review your situation - such decisions are apparently made on a case by case basis.

However, when you write your letter of enquiry (is a pay break possible? what are the implications? how does it affect the term of the loan, interest charges etc?) dont be surprised if you then receive from them a standard letter advising that from X date your new repayment rate is Y and you have Z repayments left to make.

Also expect the moratorium to take immediate effect (even though you only enquired about its possibility) and for it not to relate to any period of time you wanted it considered for! Watch out for number of repayments remaining and amount due to be "miscalculated" too....
 
AIB will do interest only for up to 2 years you just need to send in a written instruction and possibly take out extra life cover. If you want a moratorium (payment holiday) the max you will get is 3-6 months and you will need to submit a request giving a good reason. Problem with moratorium is that the interest for each month that you don't make repayments is added to the amount outstanding on your mortgage. Best to go interest only if you can!
 
Re: AIB & interest only on mortgages- CAUTION

AIB handle interest only differently to everyone else. When you take an interest only break you are accepting new terms and conditions, which may be less favourable that you previously had. This may not be transparent in the documentation that you receive.
If you know the basis that your original rate was calculated on you must insist that they include this as a condition of your new credit agreement.
AIB no longer display their "Prime rate", nor do they offer loans at prime plus X, so a loan originally granted at prime plus 2% may become something significantly dearer after a year or two of interest only.

Someone in authority in AIB has decided that the public should not be allowed compare their rates with other bank, hence the abolition of the prime rate. Bank of Ireland still offer and clearly show their prime rate.

Be afraid, be very afraid......:mad:
 
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