Extending mortgage equation questions (slide rules out folks!)

[Bishop]

A was wondering if someone can help me with a simple maths mortgage problem (simple, mortgage contradiction in terms?????). Maybe easy to work out but I’m sure I’ll missing something if I try.

I’ve a mortgage with the EBS with an outstanding balance of €167,000 I currently repaying €850 a month.

I wish to realise some of the equity in the house and wondering how much my monthly repayments would be if I extend the mortgage by €60,000 (227,000 to repay)?

The original mortgage started in March 2001 and was taken out over 25 years so I’ve completed 4 years with 21 year remaining.

Based on EBS variable rate today what can I expect the mortgage to increase to? Would I get a better deal moving to another lender?

Thanks in advance for any help.

 

[stobear]

AIB have a mortgage calculator on their website [broken link removed]. Bare in mind a cost to re-mortgage but a phone call to EBS should get you started and let you shop around.

 

[ClubMan]

You should be able to estimate your repayments using Karl Jeacle's mortgage calculator by entering €227K, 21 years and the relevant rate (APR). Note that the calculator does not factor in [broken link removed], mortgage protection life assurance costs etc.

 

[Bishop]

Thanks guys!



Karl’s calculator is good apart from the few short comings such as owners tax relief, etc.



I approached first by working out my current monthly repayment + outstanding amount + remaining time. As it does calculate the out variables I changed the rate to allow to actual monthly repayments



So

Current monthly repayment + outstanding amount + remaining time = rate

€850 + €167000 + 21years = 2.5



Using the same rate I then calculated the following



Amount + remaining time + rate = monthly repayment

€227,000 + 21 years + 2.5 = 1,058



I’m sure it not prefect but do you think it would be close?

 

[ClubMan]

Karl’s calculator is good apart from the few short comings such as owners tax relief, etc.

You can just add or subtract the ancillary figures once the calculator gives you a figure. Note that some lenders calculate interest at different frequencies than others (e.g. daily, weekly (?), monthly, annually (ugh!)) so the results from the calculator (not sure what it assumes) may not be 100% accurate in all cases. As far as I know EBS still calculate interest monthly.

Current monthly repayment + outstanding amount + remaining time = rate

€850 + €167000 + 21years = 2.5

I very much doubt that you are on 2.5% especially if you are with the EBS. If you are then you are getting a great deal judging by the best buys list. You should ask your lender what rate (nominal and APR) you are on or check your last statement or letter from them. Don't try to "reverse engineer" the rate as the results will probably be meaningless.

I’m sure it not prefect but do you think it would be close?

As I mentioned above double check your actual rate first then do the sums again.

 

[Bishop]

Thanks Club,



I fully understand that my current rate is not 2.5% however what I do know is my repayment amount, years left and remaining balance. The only thing I can play with to get the repayment amount right is the rate.



My current repayment amount obviously takes in other factors which I’ll need to get from the EBS but at least I’ve got a basic calculation to go on.

 

[ClubMan]

I don't think that using the 2.5% rate that you reverse engineered makes much sense and so I'm not sure that the post top-up repayment that you have estimated is accurate either. If you want to be sure then you should really ask EBS directly about your mortgage now and how this (e.g. repayments) would be affected by a top-up.

 

[AKA]

You should be able to estimate your repayments using Karl Jeacle's mortgage calculator by entering €227K, 21 years and the relevant rate (APR). Note that the calculator does not factor in [broken link removed], mortgage protection life assurance costs etc.

Just had a look at the [broken link removed] info on revenue site. If a house is bought by 2 people do both people get relief? If a single person buys a house do they get the same relief?

i.e. shouldn't the amount of relief be based on the property on not if your married or not?