Few other things that may be interesting:
what will be the principal amount left owning at the end of 4 years on both, should be a bit more on the higher interest rate, so thats a negative and also the account you need to have for the monthly cash back has a 6 euro per month fee so a negative 288 to the calcs.
@Paul F
Have done some number on this and came up with the following
Stay with UB at 2.2% month repayment €1,711
Switch to PTSB at 2.55% month repayment €1,767
Over 4 years
Extra monthly repayment -2,688
Solicitor fees -1,500
Valuation -150
Cash Back 6,640
2% monthly cashback 1,696 (1,767*2%*48)
Better off 3,998
Am I missing something??
No, we’re not Paul@Smack26 Are you currently getting 2% cashback every month from PTSB?
Many thanks, updated below@Alkers86 What is the fixed interest rate (%) that is coming to an end?
Are you currently getting 2% monthly cashback?
Have you considered approaching AIB? They have a 2.2% 4-year fixed rate for mortgages over €250k, and switchers get €2,000 cashback.Spoke to PTSB, switching is not currently a runner. While we pass all the individual tests, the BTL I own has a mortgage to loan ratio of 75% (max allowed is 70%) and the repayment stress test is €200 short.
Looks like a longer fix with UB is the only option at the minute.
Here are the repayment schedules over 20 years at 2.2% and at 2.55%.Have done some number on this and came up with the following
Stay with UB at 2.2% month repayment €1,711
Switch to PTSB at 2.55% month repayment €1,767
Over 4 years
Extra monthly repayment -2,688
Solicitor fees -1,500
Valuation -150
Cash Back 6,640
2% monthly cashback 1,696 (1,767*2%*48)
Better off 3,998
Am I missing something??
Because you are on a variable-rate mortgage, you do not have to pay a break fee.
- Current lender: PTSB
- Outstanding mortgage balance (how much you still owe) €213k
- Approximate value of your property €290k
- The date you started your fixed-rate mortgage (month and year): May 2019
- How many years you fixed for: 3
- Your current mortgage interest rate: 3.1%
- Your current monthly repayment (excluding any overpayments): €908
- Your property's BER (Building Energy Rating) – estimated if necessary: D2 (not reevaluated since some improvements were made)
- Are you due to get extra cashback from your current lender in the future: No
The current monthly repayment and interest rate you have given (€1,416 and 3%) imply that your mortgage has a little over 21 years left to run. Why do you say 27 years in the above line?But if I stick to my current mortgage terms (27 years, fixed rate of 2.1%) my repayments would drop to ~1100 a month.
Wow! Thank you so much Paul - you’re a mine of information.Because you are on a variable-rate mortgage, you do not have to pay a break fee.
These savings estimates use for comparison the scenario of switching immediately to the 3.0% rate with Permanent TSB but not opening an Explore account. The estimates also account for any fees (solicitors' fees, valuation fee) that you have to pay and any cashback offered by the above lenders.
- Switching immediately to KBC's 5-year fixed rate (2.45% with €3,000 cashback) will save you about €6,040 over the next 4 years
- The monthly repayment would be €950
- Of course, if you decide to do this, you will probably want to switch again in 5 years when your fixed rate expires and your mortgage moves onto Bank of Ireland's books, at which point you will be subject to their (probably higher) interest rates
- Switching immediately to Avant Money's 7-year fixed rate (2.15% with no cashback) will save you about €5,440 over the next 4 years – but with the longer security of 7 years on a fixed rate
- The monthly repayment would be €918
- Switching immediately to AIB's 5-year fixed rate (2.45% with €2,000 cashback) will save you about €5,040 over the next 4 years. (Note: Haven, AIB's sister lender, only give cashback if your mortgage is over €250k or is a green mortgage.)
- The monthly repayment would be €950
- Switching immediately to Avant Money's 10-year fixed rate (2.3% with no cashback) will save you about €4,220 over the next 4 years – but with the even-longer security of 10 years on a fixed rate
- The monthly repayment would be €934
- Switching immediately to Avant Money's 15-year fixed rate (2.5% with no cashback) will save you about €2,600 over the next 4 years – but with the even-longer security of 15 years on a fixed rate
- The monthly repayment would be €956
- Switching immediately to Finance Ireland's 10- or 15-year fixed rate (2.65% with no cashback) will save you about €1,360 over the next 4 years – but with the even-longer security of 10 or 15 years on a fixed rate
- The monthly repayment would be €972
- This product has a benefit in relation to moving home in the future that is explained below
- And your interest rate (initially 2.65%) will automatically fall as time passes and you move into lower loan-to-value (LTV) brackets. See the section "How we decide rate reductions" on this page.
- Switching immediately to Permanent TSB's 5-year fixed rate (3.0% and opening an Explore account to get the 2% monthly cashback) will save you about €680 over the next 4 years. But it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
- The monthly repayment would be €1,010
The savings estimates also assume that you are currently repaying €1,020 monthly to Permanent TSB, in order to simulate having 25 years left on your mortgage (whether you stay with Permanent TSB or switch to one of the above lenders).
All of Avant's rates, and Finance Ireland's 10-year and longer fixed rates, allow you to avoid any potential break fee if you move home in the future (as long as you take out a new mortgage with them, and subject to certain conditions). And in the case of Finance Ireland, if you are at least 3 years into your fixed rate you can "take your mortgage with you" – meaning that you get to keep the same interest rate when you move.
Also, Avant cap the break fee at 2% of the mortgage balance, so your break fee could never be more than about €4,250 with Avant (which in any case would only be relevant if you did not take out a new mortgage with them when moving).
The estimates also assume that your loan-to-value ratio (LTV) is currently 213.0k/290.0k = 73.4%. A slightly higher property valuation (€305k) and/or a few more monthly mortgage payments and/or a small overpayment would get you into a lower LTV bracket (< 70%), and you would be eligible for lower rates from Avant and Finance Ireland. But that is probably not a good reason to delay the switch – i.e., you can start the switch immediately.
Just to clarify a couple of points:Agreed on the requirements for Avant - the broker I spoke to had said that we wouldn’t be eligible for theirs based on LTV. Estate agent verbally said €290-300k but I was erring on the conservative side. We’d also have to pay the costs ourselves with Avant.
still waiting on the break fee in the post from UB. But confirmed on the phone on Monday that it’s zero, now she said valid for 28 days but I’m guessing the letter will say 10 days. It’ll be a lot longer than 10 days before we complete the switch though. Lot of questions from the broker on the bank statements. I was on unpaid maternity leave last year so they seem fixated on the money moving between savings account and current account.Your break fee should be zero at the moment – but it is volatile because wholesale interest rates are volatile, so confirm it with Ulster Bank (and please post it here when you receive it, including the date of the letter).
Note: you will receive two separate letters from Ulster Bank a few days apart, and their structure and wording can lead to confusion. Look for the line that says: "To break out of this fixed rate early, you would have to pay a fee of €X". That amount is your break fee. Ignore all other references to break fees.
These savings estimates use for comparison the scenario of doing nothing. The estimates also account for fees and any cashback offered by the above lenders.
- Switching immediately to Permanent TSB's 5-year fixed rate (2.55% with €6,520 initial cashback and 2% monthly cashback) will save you about €1,620 over the next 4 years
- Switching immediately to AIB's 4-year fixed rate (2.2% with €2,000 cashback) will save you about €540 over the next 4 years
- Switching immediately to Avant Money's 7-year fixed rate (2.05% with no cashback) will save you about €400 over the next 4 years – but with the longer security of 7 years on a fixed rate
- Breaking and re-fixing with Ulster Bank on the 5-year 2.2% rate will "reset the clock" and give you another 5 years on that rate and will not save you or cost you any money. And it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
- Of course, if you decide to do this, you will probably want to switch again in 5 years when your fixed rate expires and your mortgage moves onto Permanent TSB's books, at which point you will be subject to their (probably higher) interest rates
- Switching immediately to Avant Money's 10-year fixed rate (2.2% with no cashback) will leave you worse off by about €1,500 over the next 4 years – but with the even-longer security of 10 years on a fixed rate
- Switching immediately to Avant Money's 15-year fixed rate (2.4% with no cashback) will leave you worse off by about €4,020 over the next 4 years – but with the even-longer security of 15 years on a fixed rate
The 2.55% 5-year rate from PTSB is good over the next five years, but after that you won't be eligible to switch to their best rates – those are reserved for new customers only.
It may seem like it is not worth switching to another lender but bear in mind that your mortgage will soon be owned by Permanent TSB, whose rates are much higher than Ulster Bank's. So if you don't switch now, you might find that you really want to switch in a few years' time, at which point rates might be higher.
Note that the longer you fix for, the higher the break fee could potentially be in the future, which could be relevant if you want to move home. Of course, it's also possible for a future break fee to be small or zero. And at least some of Avant's fixed rates allow you to "take your mortgage with you" if you move home, which avoids any future break fee. It would be worth contacting them for clarification on which mortgages this applies to and on the terms and conditions.
The estimates also assume that your loan-to-value ratio (LTV) really is below 70% so that you are eligible for the listed rates. Your LTV estimate is 326.0k/480.0k = 67.9%. If you get a valuation of less than €466k, you will need to make a few more monthly mortgage payments and/or a small overpayment to get the LTV below 70%. But that is not a reason to delay the switch – i.e., you can start the switch immediately.
You are not eligible for the Avant 7-year fixed rate at 1.95% (because your loan-to-value ratio is too high) – but you are eligible to switch to any of the rates listed above, including the Avant 7-year fixed rate at 2.05%.
Have you considered approaching AIB? They have a 2.2% 4-year fixed rate for mortgages over €250k, and switchers get €2,000 cashback.
Here are the repayment schedules over 20 years at 2.2% and at 2.55%.
You will see that after 4 years, you will have paid €4,363 more in interest on the 2.55% rate. (I also assume that you can find a solicitor for €1,300 all in – see the links to the three threads about solicitors in this post. @Blackrock1 My estimates already factor in the €6/month fee that you have to pay to have a PTSB Explore account, which is needed to get the 2% monthly cashback. Although, as you say @TRS30, you pay the same fee to Ulster Bank already.)
You can't determine the savings you would make from switching mortgages by looking at the monthly mortgage payments alone, even if you factor in fees and cashback. You must look at the interest paid under both scenarios.
Re-fixing with UB is a pretty good choice. Just make sure you realise that you will almost certainly be treated as an existing customer of PTSB in 5 years' time. That means that you won't be entitled to cashback from them,Not sure the AIB one is worth it as most of the €2K would be taken up with solicitor fees, valuations etc and also factoring in my own time and effort, with the same rate I can get from UB.
I think once i get my breakage fee from UB, assuming it is zero, I will switch to their 5 year 2.2% rate.
When i was talking to PTSB yesterday they said I can over pay on a fixed rate (as much as I like), where the over payment goes into a credit a/c that is offset against the mortgage and at the end of the fixed term I can use it to pay off capital, take a payment break, reduce monthly payments etc. I like the flexibility of this option.
Re-fixing with UB is a pretty good choice. Just make sure you realise that you will almost certainly be treated as an existing customer of PTSB in 5 years' time. That means that you won't be entitled to cashback from them, not their lowest rates. For example, the lowest rate that an existing PTSB customer could switch to today is 2.95%.
That's why I suggested approaching AIB – if you can't/don't want to switch lender today, you might want to switch in five years' time.
- Current lender: KBC
- Outstanding mortgage balance (how much you still owe): €381k
- Approximate value of your property: €635k
- The date you started your fixed-rate mortgage (month and year): March 2020
- How many years you fixed for: 5 years Fixed, 30 Year Mortgage (~28 years remaining)
- Your current mortgage interest rate: 2.45%
- Your current monthly repayment (excluding any overpayments): €1,570
- Your property's BER (Building Energy Rating): C2
- Are you due to get extra cashback from your current lender in the future: No cashback due
Your break fee should be zero at the moment.
- Current lender: PTSB
- Outstanding mortgage balance (how much you still owe): €295k
- Approximate value of your property: €480k (12 months ago so likely to have increased)
- The date you started your fixed-rate mortgage (month and year): April 2021 (fixed year just ending)
- How many years you fixed for: 1, being moved now onto the variable rate
- Your current mortgage interest rate: 3.35% - Jumping to a whopping 3.8%
- Your current monthly repayment (excluding any overpayments): €1,200 at the fixed rate, we were making a €250 overpayment on top of this. Monthly repayment will go up with move back to variable.
- Your property's BER (Building Energy Rating): A3
- Are you due to get extra cashback from your current lender in the future: No cashback due or being received each month
The current monthly repayment and interest rate you have given (€1,416 and 3%) imply that your mortgage has a little over 21 years left to run. Why do you say 27 years in the above line?
Your break fee should be around €340 at the moment – but it is volatile because wholesale interest rates are volatile, so confirm it with Bank of Ireland (and please post it here when you receive it, including the date of the letter).Current lender: Bank of Ireland
Outstanding mortgage balance: 180k
Approximate value of your property: 400k
The date you started your fixed-rate mortgage: July 2017
How many years you fixed for: 5
Your current mortgage interest rate: 3.25%
Your current monthly repayment: €948 (includes a 10% overpayment)
Your property's BER: B1
Are you due to get extra cashback from your current lender in the future: No
Brilliant, thanks.Your break fee should be zero at the moment.
- Switching immediately to Haven's 4-year green fixed rate (2.0% with €2,000 cashback) will save you about €9,600 over the next 4 years
- Switching immediately to Avant Money's 7-year fixed rate (1.95% with no cashback) will save you about €8,120 over the next 4 years – but with the longer security of 7 years on a fixed rate
- Switching immediately to Avant Money's 10-year fixed rate (2.1% with no cashback) will save you about €6,440 over the next 4 years – but with the even-longer security of 10 years on a fixed rate
- Switching immediately to Avant Money's 15-year fixed rate (2.25% with no cashback) will save you about €4,740 over the next 4 years – but with the even-longer security of 15 years on a fixed rate
- Switching immediately to Finance Ireland's 10- or 15-year fixed rate (2.4% with no cashback) will save you about €3,040 over the next 4 years – but with the even-longer security of 10 or 15 years on a fixed rate
- This product has a benefit in relation to moving home in the future that is explained below
These savings estimates use for comparison the scenario of switching to the 5-year 2.80% green rate with Permanent TSB when the current fixed rate ends. The estimates also account for any fees (solicitors' fees, valuation fee) that you have to pay and any cashback offered by the above lenders.
The savings estimates also assume that you consider €1,450 to be your normal monthly payment to Permanent TSB. This means that your mortgage (whether with PTSB or with one of the above lenders) will be paid off in about 25 years. If you want estimates based on a monthly repayment to PTSB of €1,200, let me know.
All of Avant's rates, and Finance Ireland's 10-year and longer fixed rates, allow you to avoid any potential break fee if you move home in the future (as long as you take out a new mortgage with them, and subject to certain conditions). And in the case of Finance Ireland, if you are at least 3 years into your fixed rate you can "take your mortgage with you" – meaning that you get to keep the same interest rate when you move.
The estimates also assume that you get your loan-to-value ratio (LTV) below 60% so that you are eligible for the listed rates. Your LTV is currently 295k/480k = 61.5%. A slightly higher property valuation (€492k) and/or a few more monthly mortgage payments and/or a small overpayment will get you below 60%. But that is not a reason to delay the switch – i.e., you can start the switch immediately.
If you're feeling brave, you could consider the strategy outlined in this thread: switch to Haven's 2.35% 3-year fixed rate and get the €5k cashback. Then quickly switch to Haven's 2.0% green rate. If it works, you will be better off by about €12,600 in four years' time. Nobody knows for sure if Haven will allow you to do this, so you might be stuck on the 2.35% rate, but at least you'd have got the €5k cashback.
Your break fee should be around €60 at the moment – but confirm it with EBS (and please post it here when you receive it, including the date of the letter).
- Current lender: EBS
- Outstanding mortgage balance: 267,000
- Approximate value of your property: 400,000
- The date you started your fixed-rate mortgage: July 2019
- How many years you fixed for: 3
- Your current mortgage interest rate: 3%
- Your current monthly repayment (excluding any overpayments): €1416
- Your property's BER (Building Energy Rating) - no idea, but getting it assessed soon I hope, probably not 'green'
- Are you due to get extra cashback from your current lender in the future, e.g., "1% after 5 years", or "2% cashback monthly"? If so, how much and when? - 1% or 3,300 ish in 2024
You only need a broker when switching to certain lenders (Avant and Finance Ireland, for example). You always need a solicitor if switching lenders. Shop around for a lower solicitor quote – €1,300 all in should be achievable.Solicitor fees: My solicitor quoted me €1600 to switch. I've reached out to Doddle. Do I need both a broker and a solicitor? I think yes. Solicitor to deal with banks, broker to deal with Avant?
If you have a standard mortgage protection policy (with Irish Life or Zurich, etc., even if it was organised by EBS) you can simply transfer it to the new lender. But if it is a "block cover" plan that is specific to EBS, you cannot transfer it and you'll need to get a new policy. See this post. Check with EBS which type you have.Life Insurance, I went with life insurance with EBS because it was easiest. It was a bit of a faff because I am fat, which is discriminatory, but I digress. If I am switching can I keep my life insurance with them to save the hassle of dealing with all of that again?
You can see from my savings estimates that in your case their is a trade-off between bigger savings and a shorter period on a fixed rate versus smaller savings and a longer period on a fixed rate. You have to decide which you value more.Fixed term period; any guidance on whether to pick 3 - 4 - 5 - 10 year terms?