Mortgage interest relief - best repayment option?

F

Fint

Guest
Hello all,

I was just wondering if it makes any difference as to whether you receive your monthly mortgage interest relief repayment into your funding account for the mortgage account or just have the relief repayments knocked directly off the mortgage repayments?

In the medium to long term is it not better to pay off the mortgage? I have 29 years to go on my mortgage which is ovwer 200000, on a variable AIB rate, 3.24%.

Or is it better to have the money go into the funding account and have access to it in case of an emergency?

Hopefully someone can shed some light on this, thanks.
 
It is completely up to you.

If your monthly mortgage payment is €1000 and you are due €50 a month mortgage tax relief, so your effective mortgage payment is €950.

If you can afford to and choose to save €50 a month, or pay €50 a month extra off your mortgage, when you need to decide which is better for your own financial situation.

Do you have any savings (short term or long term) ?
Do you have any other debts (i.e, CC) which you are paying off ?
 
I don't understand this question or the reply above. Some lenders reduce the "gross" repayment by the TRS amount. Others charge the full amount and then credit back the TRS as two separate but usually simultaneous transactions. I don't think that you have a choice in the matter. The latter may require you to have more funds in your account than the former because at least nominally the full repayment is debited.
 
huskerdu said:
It is completely up to you.

Do you have any savings (short term or long term) ?
Do you have any other debts (i.e, CC) which you are paying off ?
Click to expand...

Hi, my only concern regarding debt is my substantial mortgage.
 
Hi there,

Maybe you understand more about the process than i. I will outline my question. I applied for mortgage relief. I received a mortgage relief payment into my joint account which i use to fund the mortgage account. I would have thought that the mortgage relief payment came directly off the mortgage repayment, decreasing them. However my payments remain the same, but i receive the mortgage relief into the joint account.

So have i missed something? Or is this normal.

 
Somewhat unusual, but you are getting the relief, so the net effect on your monthly payments is the same as the amont being lodged directly to the loan account.
 
I know that BoI do that anyway - i.e. charge the "gross" repayment and then credit back the TRS. I don't know how many other lenders do this versus just charging the repayment net of TRS. Who is your lender?
 
the money you received into your joint account may have been the trs that was owed to you for previous payments missed while the application was being processed. thus meaning that you are getting trs directly off your mortgage payment anyway.
 
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