Remortgage help!

A

Aimee

Registered User
Messages
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Hi guys,

I did try to read through other threads but my head is spinning!!

I want to remortgage, will have this mortgage for one year in March at a discounted rate, original mortgage was €255,000-00 and statement now shows balance due of €252,000-00.

I want to remortgage for €290,000-00 over 35 years and am looking for best rate possible but I don't really understand all the jargon and have yet to meet a mortgage broker who was interested in explaining it to me, they appear to go with whoever will issue a Letter of Offer the fastest, not sure they really work in your interest at all - only MO! Should I go variable, fixed rate?? What is the story with interest only??? If I paid interest only would I be penalised if I switched mortgage during it?

Any recommendations would be greatly appreciated!

and one more question - whats to stop a person remortgaging every year and taking advantage of the one year discounted for the various institutes???
 
Your choice of mortgage interest rate - fixed, variable or tracker - and type of mortgage - annuity or interest only - are decided based on your circumstances and a GOOD mortgage broker should ask you lots of questions about your circumstances before a/ making a recommendation and b/ ensuring you understand and are happy with the reasons behind the recommendation.

In answer to your questions - no, you are not penalised for switching from an interest only mortgage to an annuity mortgage.

You could, in theory, switch mortgages each year but it would cost you the guts of €1000 each time so the savings would have to substantial to cover that - if you remortgage via a fees free offer you pay a penalty of between €800-€1000 if you move lenders within 5 years.

Hope that helps!

Sarah

www.rea.ie
 
Aimee said:
Hi guys,

I did try to read through other threads but my head is spinning!!

I want to remortgage, will have this mortgage for one year in March at a discounted rate, original mortgage was €255,000-00 and statement now shows balance due of €252,000-00.

I want to remortgage for €290,000-00 over 35 years and am looking for best rate possible but I don't really understand all the jargon and have yet to meet a mortgage broker who was interested in explaining it to me, they appear to go with whoever will issue a Letter of Offer the fastest, not sure they really work in your interest at all - only MO! Should I go variable, fixed rate?? What is the story with interest only??? If I paid interest only would I be penalised if I switched mortgage during it?

Any recommendations would be greatly appreciated!

and one more question - whats to stop a person remortgaging every year and taking advantage of the one year discounted for the various institutes???
Click to expand...

Because the transaction costs are prohibitive. And where a lender subsidises or or pays your costs there is generally a clawback if you move within 5 years.
There is a best buys section which you should look at.
If you think interest rates will rise and you cannot afford higher repayments then fixing is a good option. However fixed rate mortages are not as flexible...there are exit penalties for example.
Interest only can be good while you find your feet or for short term investment property but remember you are not making any capital repayments. You always owe the principal.
There is a mortgage broker called Sarah from www.rea.ie who you'll see posting on this website. She's always helpful and patient with even the most bizarre queries. Look at some of her posts
 
Thanks guys, that was really helpful and hope you don't take offence to what I said above Sarah, obviously its not a case of "tarring all with the same brush" - I guess I was just unfortunate with the couple I previously used!

It just seems that my repayments at present are under a discount variable rate but when this ends I will pay €1200 pm on €255,000-00. Whereas if I remortgage and take out some money to finish the house once and for all I would pay approx €1380 pm (and maybe less if I can secure another discounted rate) on €290,000-00 - it is very tempting but of course I am not looking at the overall payment over the entire term, am I, oh no, I just see the tarmac down with lovely patio out back, gates at the side of the house, maybe a new sofa LOL :eek: I don't know whether I am mad to do it or not!!

I would be ok on legal fees issue, so maybe I should start becoming real clever and changing institutes each year and availing of the discounted rate whilst bringing down the term by a year each time, hmmmm :)
 
€35,000 for tarmac, gates and a new sofa is an awful lot. Cost me less than €7,000. Don't borrow for the sake of borrowing.......

Sarah

www.rea.ie
 
It's a general rule when borrowing to match the term of the loan to the lifetime of the item.
Hence, you don't put cars, furniture or holidays on your mortgage.
 
Points taken, thanks. I can see I have alot of thinking to do on this one, cheers guys x
 
Hey Guys
What are the usual costs involved in switching if you have been with your current lender for greater than 5 years??
Thanks!
K
 
I'm in the process of moving 2 mortgages (1 from EBS, 1 from PTSB) to AIB.
AIB are giving me €1,200 for each mortgage to cover legal fees.

My total legal fees come to €2,250, valuation fees €260. So I only have to stump up €110 to cover the costs of moving mortgages.
 
That's interesting re AIB paying both sets of fees. Am currently remortgaging one property and taking out a new second mortgage. So far the best offer re legal fees my broker has received only covers the fees for one of the loans. In the current climate should I push for/expect both loans to be covered?

Thanks
 
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