Should I fix mortgage?

TRS30 said:
I assume based on that above, re monthly repayment staying the same, that means you are paying more off the capital off each month, even if your overpayment(s) have not been applied?
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This is what I assumed although I didn't specifically ask, apologies. The lady on the phone was difficult to understand due to her accent.
 
Cavangal said:
This is what I assumed although I didn't specifically ask, apologies. The lady on the phone was difficult to understand due to her accent.
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This does not sound correct, because if you were paying off capital with any over-payment you make, your interest repayments should immediately adjust downward as the interest rate is applicable to a lower outstanding capital balance. In addition, given that any over payment is non-refundable, and it's not being applied directly to your repayments, where is it going?

There is something fishy going on here. I would ring up and clarify this point Cavangirl, especially since these funds are apparently 'non-refundable'
 
Cavangal said:
This is what I assumed although I didn't specifically ask, apologies. The lady on the phone was difficult to understand due to her accent.
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No need to apologies. It can be hard getting someone on the phone to answer technical queries (I've spend enough time talking to people where I knew more then they did (and I'm not an expect on much!)).


My, very limited, understanding of how this works is that any overpayments you make go into a separate a/c, linked to your mortgage. This money sits there and can be used to reduce the capital or cover future monthly repayments, once your fixed term it up (not sure about options on a variable rate). While the overpayments are sitting in this account, they offset the amount that your mortgage interest is being calculated on, i.e. mortgage of €100K, overpayments of €10K, mortgage interest is calculated on €90K.

The question here is, if you are a fixed monthly payment and make an overpayment, based on the above your repayment should reduce as you have less interest to pay. If your monthly repayment is not reduced, then where does this 'extra' money go!

I can only think of two options, it goes against the principle (€100K in example above) or it goes into this separate a/c linked to your mortgage. Does it make any difference or do both work out the same in the end??

Is not relevant for me yet as my mortgage is with UB however will likely be moved to PTSB in the near future so will be of interest then (I'm on a long term fixed rate with UB).
 
Well over the last 2 years or so I have made 4 lump sum payments off my mortgage. I could see the overpayment credit sitting as a prepayment figure on the PTSB app until I instructed them to reduce the balance. The overpayment had to be temporarily cancelled to facilitate this.

I will be able to keep an eye on the app when they fix it and report back here.
 
And did your monthly repayment amount stay the same after you made each lump sum payment? Even after you told them to reduce the balance?
 
Paul F said:
And did your monthly repayment amount stay the same after you made each lump sum payment? Even after you told them to reduce the balance?
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My payments have reduced after each lump sum payment because I am on a variable interest rate and each time I ask for the monthly payments to reduce while keeping the original term.
 
So I have been keeping an eye on the PTSB app and I was on a variable rate of 3.7%.I made a lump sum payment recently and I could see the payment figure reduce.

I fixed for 7 years at 3% and today on the app I can see the new rate and term but the payment figure has not changed. It seems to be still at the 3.7% payment rate. Will this change?
 
@Cavangal When did you re-fix at 3%? When will the next payment be taken?

Another question: did PTSB make you get an updated property valuation to re-fix at 3%?

Thanks
 
I recently fixed for 7 years with Avant at 1.95%. Shoukd I break and fix for 22 years (length of mortgage) at 2.5%?
 
Sunnysoutheast said:
I recently fixed for 7 years with Avant at 1.95%. Shoukd I break and fix for 22 years (length of mortgage) at 2.5%?
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You got the best rate on the market (now gone) and for the next few years there is likely to be nothing better.

Longer than that it's just guesswork so I would just stick with what you have and re-assess when the seven years is up.

I don't think retail mortgage holders (and I include myself here) have much insight into long-run interest rate developments and are better off not second-guessing.
 
Sunnysoutheast said:
I recently fixed for 7 years with Avant at 1.95%. Shoukd I break and fix for 22 years (length of mortgage) at 2.5%?
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It's not certain that Avant will even allow you to do this.

If your mortgage was €300k, switching to the 2.5% rate would cost you an extra €300,000*(2.5 - 1.95)/100*7 = €11,550 in interest over the next seven years (approximately).
 
Paul F said:
It's not certain that Avant will even allow you to do this.

If your mortgage was €300k, switching to the 2.5% rate would cost you an extra €300,000*(2.5 - 1.95)/100*7 = €11,550 in interest over the next seven years (approximately).
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Thanks Paul. My broker asked Avant and they said for me to contact them directly. I am awaiting a reply from my email to them.

I've a mortgage of €225,000.

I got spooked when I read in the Guardian over the weekend that 15 year fixed rates in the US have increased to 4.81% when they were 2.24% this time last year. I'm afraid that in 7 years time the mortgage rates will be north of 4% and I'll wish I'd have fixed at 2.5% for the remaining term of the mortgage!
 
Paul F said:
@Cavangal When did you re-fix at 3%? When will the next payment be taken?

Another question: did PTSB make you get an updated property valuation to re-fix at 3%?

Thanks
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I noticed on the app today that the payment has been adjusted. So going forward my mortgage of €71k approx is fixed for 7 years at 3% with payments of €369. At 3.7% it was €395.

No I did not have to get a valuation done. Thanks for all your advice and everyone on here.
 
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I'm back again. So I'm around 18 months into a 7 year fixed rate at 3% and so happy I took advice from here. Thank you all.

I have some spare funds and I wonder should I keep going at the mortgage or look at anything else? I don't have any investments and I don't have a pension. I'm a Carer so I don't think I would get any tax relief on pension payments.
 
Cavangal said:
Hi did anyone have any advice on my question please?
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Try posting in the money make over forum. For an informed answer you'll need to provide the following info:

Key Post - Basic information required for the "Money Makeover" forum

It can be difficult, but please try to use a meaningful title in your thread For example "27 year old with mortgage arrears". You will get a much better and much more coherent answer if you give as much information as possible in your first post. For example, if you give your mortgage rate, it...
www.askaboutmoney.com
 
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