NIB, LTV versus Offset Mortgage

Y

yop

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Lads,
Doing a review of the finances over the last few weeks (got rid of Eircom for Skype to start with :) ) and was watching them ads on the TV for the NIB LTV mortgage.

We currently have a mortgage of 214k over 25 years on a 2100 sq ft house on .8 acre site. House was valued 2 years ago at 285k, this was before any work was done outside the house and it was a pretty "fleeting" valuation which was done for the house insurance.

Then a few weeks ago, a new house (we live in the sticks, not an estate) was sold for 385k, smaller house, on 1/4 acre site, the house is about 50m up the road from us.
So I was thinking to myself that maybe ours was worth that or close or even more!!!!

We had up until all the garden work about 20k in the accounts, so it was reducing the % paid well down and the Offset was worth it, but now our accounts are well drained and I am beginning to wonder IF we would be better with the LTV.

Any advice on how I might go about figuring this out?

Thanks
 
Assuming you are on the NIB Offset - your rate is currently 5.24
If you have little in your current account - then the Offset is not saving you much as you realise.
Assuming your house is worth around 325K - that's an LTV of about 66% - you could get a rate of 4.7 on the LTV mortgage from NIB or 4.75% from AIB or Halifax.
That would be a repayment of around 1218 on a 25 yr mortgage. If you are on 5.24 - with no "offset" you will be paying about 1282 - so a saving of about 64 euro a month is possible. If your house is valued higher than 325k you will gat a lower rate from NIB but not the others.
If you are with NIB you will probably only have to pay a valuation fee of aroung 150 euro.
 
You need lump savings or the Offset mortgage isn't worth your while. I looked into it and basically you need around €50k constantly in your account to 'offset' against the mortgage. The reason you need so much cash is because the bank penalises you for offsetting the funds by imposing a higher interest rate. It really only works for someone who is saving a lump for their kids going to college or who has a constant floating fund for their business. Sounds like you're much better going for the LTV product - a few different banks offer them so you should check them all out before setting with NIB
 
Wow, thanks for all the info, I appreciate it, I would not even know where to start on all that!!!!
Thank you very much.
 
I too am in the situation of pondering a LTV v offset mortgage with NIB.

Smaller mortgage though thankfully.

I have free banking under the offset mortgage.

I will pay a fair amount of fees on the Easy a/c you must set up with the LTV product.

But if you have very little in the current account then is better definitely I think to go for the LTV product.
 
As far as I know NIB may not be the only lender offering descending tiered tracker rates for lower LTVs even if the others may not advertise/market them as much.
 
Clubman,

Do you know if ulsterbank are one of these banks you mention?I have a fairly healthy LTV around 25% and my rate is ECB +.95 with UB, so could be doiing better I guess, but could do without the 'hassle' of switching
 
ClubMan said:
As far as I know NIB may not be the only lender offering descending tiered tracker rates for lower LTVs even if the others may not advertise/market them as much.
Click to expand...

As far as I know all the other lenders will offer set rates on a range of LTV such as AIB 4.75% on LTV of 50% to 80%.
NIB offer a specific rate for every LTV between 50 and 80% i.e 4.5 for 50% , 4.55 for 55% 4.6 for 60% , etc up to 4.8% for 80% .
I don't think any other lender offers this?
 
Att: Yop and Irish Links

2 choices of Easy a/c to open on taking out a LTV product with NIB:

Easy plus a/c - quarterly fee of Euro 18.75

Easy a/c - over the counter debits and cheques.
first 6 only per qtr are free and after that 34 cent per transaction.
if you write a good few cheques they add up.
 
thespecialon said:
Clubman,

Do you know if ulsterbank are one of these banks you mention?I have a fairly healthy LTV around 25% and my rate is ECB +.95 with UB, so could be doiing better I guess, but could do without the 'hassle' of switching
Click to expand...
No idea. Shop around. Do the Financial Best Buys lists not cover mortgages?
 
Daddy said:
Att: Yop and Irish Links

2 choices of Easy a/c to open on taking out a LTV product with NIB:

Easy plus a/c - quarterly fee of Euro 18.75

Easy a/c - over the counter debits and cheques.
first 6 only per qtr are free and after that 34 cent per transaction.
if you write a good few cheques they add up.
Click to expand...

Sorry - I was wrong about the charges on the Easy A/c - But still - I think that even paying 18.75 a quarter fees to reduce your mortgage by at least 180 a quarter (in Yops case) is still a good deal .
 
Irish Links

I agree. Large loan and little in offset current a/c good idea.

My case 75k loan and 15-20k in current a/c - not worthwhile to change - 10 years remain
on mortgage.

Open to anyone's opinion though.
 
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