Key Post I have a KBC tracker – should I consider fixing?

Thank you, Brendan. I will contact them tomorrow. I wasn't aware you could go back to the tracker afterwards. Interesting to know.

Paddy1981 said:

I wasn't aware you could go back to the tracker afterwards.

Click to expand...

That is the key point here. I would not trust Bank of Ireland if this was not a feature of the KBC tracker to fixed deal.

Brendan

We moved house in 2021 so we have a tracker mover rate for the existing mortgage and then a fixed rate for the difference in what we borrowed.

1) Existing tracker margin :- KBC tracker mover rate ECB + 2.5%

2) 2.45% fixed (3 years remaining on fixed rate)
3) Approx 225000 on tracker and 118000 on fixed
4) Tracker 14 years, fixed 22 years
5) KBC (both)
6) Approx 525000 (House being valued next week)
7) Happy to overpay if possible
8) No barriers to switching
9) Open minded
10) BER C2

Im not sure whether to fix the tracker for say 3 years and then when both are off the fixed rate maybe roll them together?
One query is we are looking to carry out an extension on the house and given current costs its beyond a credit union home improvement loan, if we were to fix the tracker would that scupper looking to extend the existing mortgage?

@mikerd4

You have €225,000 on a tracker with a margin of 2.5%. That means, that you will be paying 5.5% shortly. A margin of 2.5% is worth nothing.

I think you are now a Bank of Ireland customer since last Friday?

Assuming you are a Bank of Ireland customer, you can fix for 10 years at 3.8%. You could fix for 5 years at 3.5% but you would be vulnerable to Bank of Ireland's exploitative rates after that with 9 years to go, so I think 10 years is the right answer.

If you are still a KBC customer you can fix for 5 years at 4% and keep your tracker. But your tracker rate is worthless.

So try to get the Bank of Ireland rate.

Brendan

mikerd4 said:

Im not sure whether to fix the tracker for say 3 years and then when both are off the fixed rate maybe roll them together?

Click to expand...

Absolutely no reason to do this. Treat them as two separate mortgages.

mikerd4 said:

if we were to fix the tracker would that scupper looking to extend the existing mortgage?

Click to expand...

Why would that affect anything?

I think you will just be taking out a third mortgage. The existing ones won't be affected in any way.

Brendan

I got the text msg five mins ago to say Im now a boi customer for my mortgage. Ill have to look at the rates you listed above and go from there. Thank you

I would go further and say that a margin of 2.5% is costing you money over virtually every other rate out there.

I'd get rid of that tracker today.

I started this thread and am now revisiting it.

Our mortgage transferred to BOI from KBC and BOI are offering 10 years fixed rate at 3.8% or 4% depending on LTV. We have a tracker of +1.25% and 15 years left on the mortgage with a balance of €298k. If we fix we want to fix for as long as possible for certainty about payments for the next few years. Any advice on whether with 15 years left on the mortgage sticking with the tracker long term or fixed rates are best?

cruchan09 said:

I started this thread and am now revisiting it.

Our mortgage transferred to BOI from KBC and BOI are offering 10 years fixed rate at 3.8% or 4% depending on LTV. We have a tracker of +1.25% and 15 years left on the mortgage with a balance of €298k. If we fix we want to fix for as long as possible for certainty about payments for the next few years. Any advice on whether with 15 years left on the mortgage sticking with the tracker long term or fixed rates are best?

Click to expand...

Please post the information in this format

1) Existing tracker margin. (This is set in your mortgage contract.)

• ECB + 1.25%

2) If you have an additional mortgage on the same property, what is the rate?

• n/a

3) Amount outstanding on your mortgage

• €298k

4) Remaining term - 20 years but we are planning to drop this to 15 years whether we fix it or not
5) Lender - BOI
6) Value of your home - €400K
7) Might you trade up or overpay your mortgage? Unlikely at this stage
8) Do you face any barriers to switching? E.g., an impaired credit record, a mortgage with a warehoused portion due to a restructuring, reduced income since you took out your mortgage, you are now renting out the property. No
9) What rates are you considering fixing at? 3.8% for 10 years.
10) Does your house have a high BER rating which might qualify it for a lower rate? Check it here or estimate it if necessary. No
11) How well could you handle a further 2% rise in the ECB rate? Ok I think.

The ECB rate is currently 3% and likely to go up to 4% over the coming months. So you will be paying 5.25%
It's very difficult to forecast mortgage rates, but assume a long term ECB rate of 2% which would mean that you will be paying 3.25%

So it's close. It looks like good value, but you will be subject to Bank of Ireland's predatory behaviour towards existing customers when the fixed rate ends. That won't be too bad as you will have only 5 years left when the fixed rate ends.

The risk is probably on the up side - in other words, ECB rates are more likely to be higher than 2% , and possibly much higher, than they are to be lower, and much lower.

So it's a toss up. On balance, fix.

Brendan

Thanks Brendan. BOI confirmed an offer of fixed at 3.8% for ten years guaranteed until the end of the month so we will go with that I think.

Thanks for the advice.