mortgage and credit unions

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mattym

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I have 183,000 left to pay on my mortgage which at the moment is on a variable rate of 2.63%. With interest rates looking like rising, i'm checking to see what options i have on keeping the repayments down. I'm working in the private sector but in a secure position. Any point in trying the Credit Union where i save weekly for a loan to pay off a lump sum on the mortgage? Probably a silly question but any opinions would be appreciated
 
You said you thought it was a silly question - well it is. You would be borrowing from the credit union at at least 6% - probably 7 or 8% - to pay off a loan at 2.63%. It just doesn't make financial sense.
 
Fair enough Irishlinks, cheers. Would your opinion be to fix or to stay variable at the moment. Cant see myself getting a great deal to fix it. I'm with the EBS.
 
You would have to pay about 3.49% on a 3 yr fixed with ESB. variable rates are rising - but to pay extra now to try and save money in the second or third year is risky.
If it was me - I would stay variable . If you can afford the repayments on the fixed rate - then why not put the difference in a savings account instead - and use it when the variable rate goes up past 3.49%

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My parents just paid off their mortgage with a credit union loan and have worked out that its way somehow cheaper. You cant just go by interest rates. Its to do with how often you make repayments aswell. Its cheaper to make weekly repayments with a cu loan.

Do your calculations. Most credit unions have a loan calculator.
Ive tried to work out how my parents saved money (and have edited this post 3 times!) but I cant-may be something to do with combining loans and paying it off quicker?

You have far too much left to pay off in one go though so I agree, stick with variable and pay more into your mortgage to pay it off faster.
 
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