Key Post Switch or re-fix my mortgage? Breakage fee calculator and savings estimates for your case (Ireland)

[diablo73]

Current lender: AIB
Outstanding mortgage balance: 160k
Approximate value of your property: 650k
The date you started your mortgage: 14 March 2014
How many years you fixed for: 0 (on variable rate)
Your current mortgage interest rate: 2.75%
Your current monthly repayment: €783.86
Your property's BER: C1
Are you due to get extra cashback from your current lender in the future: No

 

[Paul F]

• Current lender: KBC
• Outstanding mortgage balance (how much you still owe): 175000
• Approximate value of your property: 500000
• The date you started your fixed-rate mortgage (month and year): NA (we're on a variable)
• How many years you fixed for: NA
• Your current mortgage interest rate: 3.2%
• Your current monthly repayment (excluding any overpayments): €906
• Your property's BER (Building Energy Rating) – check it here or estimate it if necessary: C1
• 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 (monetary amount) and when? No

The remaining term on my mortgage is 22.5 years, and we want to reduce that significantly. We had a lot of savings sitting on deposit, so I'm thinking of bringing the balance down to 125K, and trying to remortgage with avant (or whoever) to get a fixed 5 year mortgage.

@RonanL Because you are on a variable-rate mortgage, you do not have to pay a break fee. For the same reason, you can reduce the balance by as much as you want without having to pay a penalty to KBC.

The below savings estimates assume that your mortgage balance is €125k but that you keep your monthly repayment to KBC unchanged (€906), which would mean that your mortgage will be cleared in about 14 years.

• Switching immediately to AIB's 5-year fixed rate (2.35% with €2,000 cashback) will save you about €3,500 over the next 3 years
  
  
• Switching immediately to KBC's 3-year fixed rate (2.25% with no cashback) will save you about €3,140 over the next 3 years. And it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
  • Note that if you decide to do this, your mortgage will soon move onto Bank of Ireland's books, and they discriminate between new and existing customers, i.e., their best rates are not available to existing customers
  • For example, if you were an existing Bank of Ireland customer, the best rate you would be able to switch to today is 3.0%
  • So if you switch to this KBC offer now, you will probably not be eligible to switch to one of Bank of Ireland's low rates in the future and you will end up on a higher interest rate. When that happens, you may want to switch again to another lender, which will incur costs (and it might be impossible to switch if your financial situation has deteriorated).
  
  
• Switching immediately to KBC's 5-year fixed rate (2.4% with no cashback) will save you about €2,620 over the next 3 years. And it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
  • The same warnings as above regarding higher Bank of Ireland rates in the future apply
  
  
• Switching immediately to Haven's 7-year fixed rate (2.65% with €2,000 cashback) will save you about €2,460 over the next 3 years – but with the longer security of 7 years on a fixed rate
  
  
• Switching immediately to Avant Money's 5-year fixed rate (2.15% with no cashback) will save you about €2,160 over the next 3 years
  
  
• Switching immediately to Avant Money's 7-year fixed rate (2.25% with no cashback) will save you about €1,820 over the next 3 years – but with the longer security of 7 years on a fixed rate
  
  
• Switching immediately to Haven's 10-year fixed rate (2.85% with €2,000 cashback) will save you about €1,760 over the next 3 years – but with the longer security of 10 years on a fixed rate
  
  
• Switching immediately to Avant Money's 10-year fixed rate (2.4% with no cashback) will save you about €1,300 over the next 3 years – but with the longer security of 10 years on a fixed rate
  
  
• Switching immediately to Avant Money's "One Mortgage" (a 2.4% fixed rate with no cashback) will save you about €1,300 over the next 3 years – and the interest rate will remain fixed for the remainder of your mortgage term (approximately 14 years)
  
  
• Switching immediately to KBC's 10-year fixed rate (2.85% with no cashback) will save you about €1,060 over the next 3 years – but with the longer security of 10 years on a fixed rate. And it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
  • The same warnings as above regarding higher Bank of Ireland rates in the future apply
  
  
• Switching immediately to Finance Ireland's 10-year fixed rate (2.9% with no cashback) will leave you worse off by about €440 over the next 3 years – but with the longer security of 10 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 staying on the variable rate with KBC and assume that that rate doesn't change between now and June 2025 (which is very unlikely). The estimates also account for any fees (solicitors' fees, valuation fee) that you have to pay and any cashback offered by the above lenders.

It may seem like it is not worth switching to another lender but bear in mind that your mortgage will soon be owned by Bank of Ireland, whose rates are much higher than KBC'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 (and it might be impossible to switch if your financial situation has deteriorated).

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 you can "take your mortgage with you" – meaning that you get to keep the same interest rate when you move (again, subject to certain conditions).

Bear in mind that interest rates could rise between now and the time that you complete any switch, so if you are thinking of switching you should probably apply simultaneously to two or more lenders for approval in principle (AIP).

Remember also that overpaying your mortgage may not be the best use of your money. Your priorities should usually be:

• Paying off expensive debt (credit cards, personal loans, car loans, etc.)
• Building up an emergency fund in a savings/current account (3 to 6 months' living expenses)
• Saving money for any expenses you will have over the next few years (kids; childcare; adult children going to college, etc.)
• Maxing out your pension contributions (very large tax relief is given)
• Overpaying your mortgage

in approximately that order.

 

[Leighlinboy]

@Leighlinboy Please your mortgage details in the format shown in the first post.

If you are talking about the break fee in a hypothetical future scenario, that cannot be predicted with any certainty.

Thanks , in process of switching ...im borrowing 237k over 20 years at 2.35% with Finance Ireland .

 

[Paul F]

Thanks , in process of switching ...im borrowing 237k over 20 years at 2.35% with Finance Ireland .

@Leighlinboy You may or may not be aware that Finance Ireland are about to increase their rates very substantially:

Finance Ireland announces substantial rate increases

From 27th June 2022: 3 and 5 year fixed rate products will increase by 120bps across all LTV bands (Progress & Progress Plus). Rates for longer term products (10, 15, 20 & 25 years) will increase by 50bps Loan Offers honoured at current rates All loan offers issued by cob Friday June...

www.askaboutmoney.com

You can only avoid this rate increase if you get a full loan offer from Finance Ireland (not just Approval in Principle) by the end of this week.

From another thread it sounds like you are nearly there (or maybe you already have the full loan offer). But if you want savings estimates for switching instead to a different lender, you can post your full mortgage details here.

 

[Paul F]

Current lender: AIB
Outstanding mortgage balance: 160k
Approximate value of your property: 650k
The date you started your mortgage: 14 March 2014
How many years you fixed for: 0 (on variable rate)
Your current mortgage interest rate: 2.75%
Your current monthly repayment: €783.86
Your property's BER: C1
Are you due to get extra cashback from your current lender in the future: No

@diablo73 Because you are on a variable-rate mortgage, you do not have to pay a break fee.

• Switching immediately to Avant Money's 4-year fixed rate (1.95% with no cashback) will save you about €3,360 over the next 4 years
  
  
• Switching immediately to AIB's 5-year fixed rate (2.35% with no cashback) will save you about €2,280 over the next 4 years. And it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
  
  
• Switching immediately to Avant Money's 5-year fixed rate (2.15% with no cashback) will save you about €2,160 over the next 4 years
  
  
• Switching immediately to Avant Money's 7-year fixed rate (2.25% with no cashback) will save you about €1,560 over the next 4 years – but with the longer security of 7 years on a fixed rate
  
  
• Switching immediately to Haven's 7-year fixed rate (2.65% with €2,000 cashback) will save you about €1,160 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 (2.4% with no cashback) will save you about €640 over the next 4 years – but with the longer security of 10 years on a fixed rate
  
  
• Switching immediately to Avant Money's "One Mortgage" (a 2.5% fixed rate with no cashback) will save you about €40 over the next 4 years – and the interest rate will remain fixed for the remainder of your mortgage term (approximately 23 years)
  
  
• Switching immediately to AIB's 10-year fixed rate (3.1% with no cashback) will leave you worse off by about €2,300 over the next 4 years – but with the longer security of 10 years on a fixed rate. And it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
  
  
• Switching immediately to Finance Ireland's 10- or 15-year fixed rate (2.9% with no cashback) will leave you worse off by about €2,420 over the next 4 years – but with the 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
  
  
• Switching immediately to Finance Ireland's 20-year fixed rate (3.0% with no cashback) will leave you worse off by about €3,020 over the next 4 years – but with the longer security of 20 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 staying on the variable rate with AIB and assume that that rate doesn't change between now and June 2026 (which is very unlikely). The estimates also account for any fees (solicitors' fees, valuation fee) that you have to pay and any cashback offered by 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 you can "take your mortgage with you" – meaning that you get to keep the same interest rate when you move (again, subject to certain conditions).

Bear in mind that interest rates could rise between now and the time that you complete any switch, so if you are thinking of switching you should probably apply simultaneously to two or more lenders for approval in principle (AIP).

 

[RonanL]

@RonanL Because you are on a variable-rate mortgage, you do not have to pay a break fee. For the same reason, you can reduce the balance by as much as you want without having to pay a penalty to KBC.

The below savings estimates assume that your mortgage balance is €125k but that you keep your monthly repayment to KBC unchanged (€906), which would mean that your mortgage will be cleared in about 14 years.

• Switching immediately to AIB's 5-year fixed rate (2.35% with €2,000 cashback) will save you about €3,500 over the next 3 years
  
  
• Switching immediately to KBC's 3-year fixed rate (2.25% with no cashback) will save you about €3,140 over the next 3 years. And it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
  • Note that if you decide to do this, your mortgage will soon move onto Bank of Ireland's books, and they discriminate between new and existing customers, i.e., their best rates are not available to existing customers
  • For example, if you were an existing Bank of Ireland customer, the best rate you would be able to switch to today is 3.0%
  • So if you switch to this KBC offer now, you will probably not be eligible to switch to one of Bank of Ireland's low rates in the future and you will end up on a higher interest rate. When that happens, you may want to switch again to another lender, which will incur costs (and it might be impossible to switch if your financial situation has deteriorated).
  
  
• Switching immediately to KBC's 5-year fixed rate (2.4% with no cashback) will save you about €2,620 over the next 3 years. And it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
  • The same warnings as above regarding higher Bank of Ireland rates in the future apply
  
  
• Switching immediately to Haven's 7-year fixed rate (2.65% with €2,000 cashback) will save you about €2,460 over the next 3 years – but with the longer security of 7 years on a fixed rate
  
  
• Switching immediately to Avant Money's 5-year fixed rate (2.15% with no cashback) will save you about €2,160 over the next 3 years
  
  
• Switching immediately to Avant Money's 7-year fixed rate (2.25% with no cashback) will save you about €1,820 over the next 3 years – but with the longer security of 7 years on a fixed rate
  
  
• Switching immediately to Haven's 10-year fixed rate (2.85% with €2,000 cashback) will save you about €1,760 over the next 3 years – but with the longer security of 10 years on a fixed rate
  
  
• Switching immediately to Avant Money's 10-year fixed rate (2.4% with no cashback) will save you about €1,300 over the next 3 years – but with the longer security of 10 years on a fixed rate
  
  
• Switching immediately to Avant Money's "One Mortgage" (a 2.4% fixed rate with no cashback) will save you about €1,300 over the next 3 years – and the interest rate will remain fixed for the remainder of your mortgage term (approximately 14 years)
  
  
• Switching immediately to KBC's 10-year fixed rate (2.85% with no cashback) will save you about €1,060 over the next 3 years – but with the longer security of 10 years on a fixed rate. And it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
  • The same warnings as above regarding higher Bank of Ireland rates in the future apply
  
  
• Switching immediately to Finance Ireland's 10-year fixed rate (2.9% with no cashback) will leave you worse off by about €440 over the next 3 years – but with the longer security of 10 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 staying on the variable rate with KBC and assume that that rate doesn't change between now and June 2025 (which is very unlikely). The estimates also account for any fees (solicitors' fees, valuation fee) that you have to pay and any cashback offered by the above lenders.

It may seem like it is not worth switching to another lender but bear in mind that your mortgage will soon be owned by Bank of Ireland, whose rates are much higher than KBC'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 (and it might be impossible to switch if your financial situation has deteriorated).

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 you can "take your mortgage with you" – meaning that you get to keep the same interest rate when you move (again, subject to certain conditions).

Bear in mind that interest rates could rise between now and the time that you complete any switch, so if you are thinking of switching you should probably apply simultaneously to two or more lenders for approval in principle (AIP).

Remember also that overpaying your mortgage may not be the best use of your money. Your priorities should usually be:

• Paying off expensive debt (credit cards, personal loans, car loans, etc.)
• Building up an emergency fund in a savings/current account (3 to 6 months' living expenses)
• Saving money for any expenses you will have over the next few years (kids; childcare; adult children going to college, etc.)
• Maxing out your pension contributions (very large tax relief is given)
• Overpaying your mortgage

in approximately that order.

Thanks so much for the amazingly detailed reply. One question - if we complete a change to our KBC terms now, will Bank Of Ireland have to honour those terms when we transition to them? So, if we fixed for 5 years for example.

 

[Paul F]

What would need to happen in order for there to be a significant break fee from AIB based on their current formula?

@Lucan22 I'll assume that your loan-to-value (LTV) ratio is 75% and you successfully switch around now to AIB's 5-year green rate (2.15%).

In order for their to be any break fee in the future:

• The relevant AIB rates (from amongst the 5, 4, 3, 2 and 1-year LTV<80% rates) would have to fall below 2.15%, and
• The relevant interbank rate would have to fall below about 2.27% (the 2.27% comes from today's 5-year swap rate, which can be used as a proxy)

For example, if there are four and a bit years left on your fixed-rate period, the relevant AIB rates are their 4- and 5-year rates (the rates whose fixed-rate periods are closest to the amount of time remaining on to your fixed-rate period).

The relevant interbank rate would be the 4-year rate. (We could use the 4-year swap rate as a proxy.) Here are all the swap rates.

So two things have to happen in order for there to be a break fee, whereas with other lenders it is only one.

Have a look at the original thread on the topic for more info.

 

[Paul F]

One question - if we complete a change to our KBC terms now, will Bank Of Ireland have to honour those terms when we transition to them? So, if we fixed for 5 years for example.

Bank of Ireland must honour the terms of your mortgage contract. So they couldn't change the interest rate while you are still in the fixed-rate period.

I wouldn't bet on Bank of Ireland continuing to allow the 10% overpayment facility when they buy your mortgage from KBC – unless that is written in to your KBC mortgage contract. There are differing views on this site about whether Bank of Ireland will maintain such features or not.

 

[diablo73]

@diablo73 Because you are on a variable-rate mortgage, you do not have to pay a break fee.

• Switching immediately to Avant Money's 4-year fixed rate (1.95% with no cashback) will save you about €3,360 over the next 4 years
  
  
• Switching immediately to AIB's 5-year fixed rate (2.35% with no cashback) will save you about €2,280 over the next 4 years. And it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
  
  
• Switching immediately to Avant Money's 5-year fixed rate (2.15% with no cashback) will save you about €2,160 over the next 4 years
  
  
• Switching immediately to Avant Money's 7-year fixed rate (2.25% with no cashback) will save you about €1,560 over the next 4 years – but with the longer security of 7 years on a fixed rate
  
  
• Switching immediately to Haven's 7-year fixed rate (2.65% with €2,000 cashback) will save you about €1,160 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 (2.4% with no cashback) will save you about €640 over the next 4 years – but with the longer security of 10 years on a fixed rate
  
  
• Switching immediately to Avant Money's "One Mortgage" (a 2.5% fixed rate with no cashback) will save you about €40 over the next 4 years – and the interest rate will remain fixed for the remainder of your mortgage term (approximately 23 years)
  
  
• Switching immediately to AIB's 10-year fixed rate (3.1% with no cashback) will leave you worse off by about €2,300 over the next 4 years – but with the longer security of 10 years on a fixed rate. And it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
  
  
• Switching immediately to Finance Ireland's 10- or 15-year fixed rate (2.9% with no cashback) will leave you worse off by about €2,420 over the next 4 years – but with the 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
  
  
• Switching immediately to Finance Ireland's 20-year fixed rate (3.0% with no cashback) will leave you worse off by about €3,020 over the next 4 years – but with the longer security of 20 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 staying on the variable rate with AIB and assume that that rate doesn't change between now and June 2026 (which is very unlikely). The estimates also account for any fees (solicitors' fees, valuation fee) that you have to pay and any cashback offered by 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 you can "take your mortgage with you" – meaning that you get to keep the same interest rate when you move (again, subject to certain conditions).

Bear in mind that interest rates could rise between now and the time that you complete any switch, so if you are thinking of switching you should probably apply simultaneously to two or more lenders for approval in principle (AIP).

Thank you, this was very useful.

 

[sobs17]

Current lender: EBS
Outstanding mortgage balance: 235k
Approximate value of your property: 370k
The date you started your fixed-rate mortgage: January 2021
How many years you fixed for: 3
Your current mortgage interest rate: 2.9%
Your current monthly repayment: 1000 approx
Your property's BER: A3
Are you due to get extra cashback from your current lender in the future: 2,400 if stay until 2026 (1% for further 2 years after 3 year term complete)

Questions:
1, How long does the process take to switch provider as my zero break fee is in place until Friday? Or how much would this change by in the next few weeks?
2, Can I pay a lump sum to take my LTV below 60% to avail of a better rate?

 

[___berta___]

Current lender: Ulster Bank
Outstanding mortgage balance: 246k
Approximate value of your property: 395k
The date you started your fixed-rate mortgage: September 2020
How many years you fixed for: 2
Your current mortgage interest rate: 2.3%
Your current monthly repayment: 1381 eur
Your property's BER: B1
Are you due to get extra cashback from your current lender in the future: No

Some considerations:
- we would like to move from Ireland within the next 5 years
- not sure if we will sell or keep the house and rent it out
- we are both in higher income bracket and are good savers, so we would consider overpaying mortgage by 10% annually

What do you think would be the best option for us? Ulster Bank breaking fee is 0 eur.

 

[Lucan22]

@Lucan22 I'll assume that your loan-to-value (LTV) ratio is 75% and you successfully switch around now to AIB's 5-year green rate (2.15%).

In order for their to be any break fee in the future:

• The relevant AIB rates (from amongst the 5, 4, 3, 2 and 1-year LTV<80% rates) would have to fall below 2.15%, and
• The relevant interbank rate would have to fall below about 2.27% (the 2.27% comes from today's 5-year swap rate, which can be used as a proxy)

For example, if there are four and a bit years left on your fixed-rate period, the relevant AIB rates are their 4- and 5-year rates (the rates whose fixed-rate periods are closest in terms of time remaining).

The relevant interbank rate would be the 4-year rate. (We could use the 4-year swap rate as a proxy.) Here are all the swap rates.

So two things have to happen in order for there to be a break fee, whereas with other lenders it is only one.

Have a look at the original thread on the topic for more info.

Thanks a lot Paul for such useful information. Much appreciated.

 

[SCA911]

• Current lender: EBS
• Outstanding mortgage balance (how much you still owe): €275,000
• Approximate value of your property: €500,000
• The date you started your fixed-rate mortgage (month and year): Feb 2022
• How many years you fixed for: 1
• Your current mortgage interest rate: 2.9%
• Your current monthly repayment (excluding any overpayments): €1,385
• Your property's BER (Building Energy Rating) – check it here or estimate it if necessary: B2 (est)
• 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 (monetary amount) and when?: No

The above details are in relation to our PPR. We started the mortgage in 2009 for €355,000 when our build commenced and final draw down was in 2010 on completion of build. Mortgage taken out was for 34 yrs as we were still living in our first home with the intention of selling same, reducing capital and years on new build to something close to 25 yr mortgage with money from sale. Circumstances dictated that it was wiser to hold onto first home and rent out as the market was so poor in 2010.

Roll on to 2022 and we are in the process of selling this first property now. Small mortgage still on this and once sold, and all going well, we anticipate having approx €220,000 left over once mortgage is clear and all fees and CGT is paid. No breakage fee there as it's on a variable rate.

Question is, we are in a fixed on PPR until Feb 2023. If we reduce the o/s capital on PPR, when fixed ends, with proceeds from sale of first home to below €100K are we then not an attractive customer for a switch? Should we switch first and then reduce capital? Quite peeved with current lender as we applied for interest only on the rental while it is on the market, to reduce strain on finances of covering both mortgages for that period, but were refused.

Also wondering when we do reduce o/s balance on PPR should we continue similar monthly payments to clear mortgage in approx 5 yrs, going on my figures, and fix for that length of time? Or reduce monthly payments and spread over 10 yrs, fixing for 4/5 yrs and hope for the best for the remaining 5 yrs. Have always been quite averse to fixing for a long period but looking at how things are going it may be time to get over that hesitation.

 

[barneyrubble]

Apologies if this has been asked earlier but has anyone had much of a delay in receiving the break fee letter from UB? Requested it well over a week ago and it hasn't arrived yet. I just want to move rates with them to lock in a new fixed rate term and eager to get it done before any rate changes!

Requested on 29th of May and haven't received it yet. Have rang 3 times and still not received!
Got our change rate letter for the fixed part of our mortgage but that's all

Getting frustrated with them!

 

[Paul F]

Requested on 29th of May and haven't received it yet. Have rang 3 times and still not received!
Got our change rate letter for the fixed part of our mortgage but that's all

Getting frustrated with them!

You should press ahead with your plans even if the break fee quote hasn't arrived – if those plans are to switch to another lender. The break fee is likely to be zero. If your plans are to re-fix with Ulster Bank, keep at them to send the break fee quote.

 

[Indecisive.com]

• Current lender UB
• Outstanding mortgage balance (how much you still owe) 160k
• Approximate value of your property 435k
• The date you started your fixed-rate mortgage (month and year) Oct 2018
• How many years you fixed for: 4 years, end 30 Sep 2022
• Your current mortgage interest rate 2.6%
• Your current monthly repayment (excluding any overpayments) €1269
• Your property's BER (Building Energy Rating) – C1 (BER is 10 years old, might possibly be a B3 now - have replaced open fire with stove and put thermostatic valves on all the rads)
• Are you due to get extra cashback from your current lender: No

Thanks Paul for this. I've been following this post for quite a while and thought I knew what I was doing but now I'm having doubts! I got a break-fee quote of €237.86 on the 16th May, valid until 27th May. This is obviously out of date now and another monthly mortgage payment has gone through since.
I have started the switching process to Avant (I am thinking 7 year fixed) but its painfully slow. Got AIP on 16May22 and I would consider myself a straightforward case (just me, no other loans, good job\income, good LTV). Am now wondering whether I should just extend fixed rate with UB (I didn't realize until I read it here yesterday, that I would be able to do this straight away without penalty, and not have to wait until September) or maybe try get the green rate mortgage with AIB and at least get the €2k cashback (if my BER is B3).
Thanks in advance for any advice!

 

[Midtablemanager]

Requested on 29th of May and haven't received it yet. Have rang 3 times and still not received!
Got our change rate letter for the fixed part of our mortgage but that's all

Getting frustrated with them!

I received the break fee letter but still haven't received the rate change so feel your pain. I requested both on the 8th June and break fee arrived on the 16th to be actioned by this Friday.

As Paul mentioned above, will keep at them. My break fee is most likely going to be zero and I only plan to re-fix with them so once I get that letter will plough ahead with that and pay the zero break fee.

Frustrating all the same for what should be relatively straight forward

 

[Leighlinboy]

@Leighlinboy You may or may not be aware that Finance Ireland are about to increase their rates very substantially:

Finance Ireland announces substantial rate increases

From 27th June 2022: 3 and 5 year fixed rate products will increase by 120bps across all LTV bands (Progress & Progress Plus). Rates for longer term products (10, 15, 20 & 25 years) will increase by 50bps Loan Offers honoured at current rates All loan offers issued by cob Friday June...

www.askaboutmoney.com

You can only avoid this rate increase if you get a full loan offer from Finance Ireland (not just Approval in Principle) by the end of this week.

From another thread it sounds like you are nearly there (or maybe you already have the full loan offer). But if you want savings estimates for switching instead to a different lender, you can post your full mortgage details here.

Thanks Paul, still waiting for the white smoke from Finance Ireland , Kbc slow releasing deeds , im well down the line but it will be touch and go to get the offer by Friday broker hopeful . Ill
be back to square one , refixing with KBC will really be my only option if i can get in before they raise rates also . Starting a switch again wont be an option ... really liked the transfer ur mortgage facility with Finance Ireland .. id be looking to trade up in next year or so .

 

[Paul F]

Thanks Paul, still waiting for the white smoke from Finance Ireland , Kbc slow releasing deeds , im well down the line but it will be touch and go to get the offer by Friday broker hopeful . Ill
be back to square one , refixing with KBC will really be my only option if i can get in before they raise rates also . Starting a switch again wont be an option ... really liked the transfer ur mortgage facility with Finance Ireland .. id be looking to trade up in next year or so .

@Leighlinboy You could re-fix with KBC or you could accept the rate increase with Finance Ireland if you don't get your loan offer by Friday. (If KBC haven't even released the deeds yet that seems impossible.)

The rate increase for Finance Ireland's 10-year and longer fixed rates is "only" 0.5%, so you could have a 15-year fix at 3.05%, and you would have the "take your mortgage with you" facility when trading up:

Finance Ireland announces substantial rate increases

From 27th June 2022: 3 and 5 year fixed rate products will increase by 120bps across all LTV bands (Progress & Progress Plus). Rates for longer term products (10, 15, 20 & 25 years) will increase by 50bps Loan Offers honoured at current rates All loan offers issued by cob Friday June...

www.askaboutmoney.com

 

[Paul F]

Current lender: EBS
Outstanding mortgage balance: 235k
Approximate value of your property: 370k
The date you started your fixed-rate mortgage: January 2021
How many years you fixed for: 3
Your current mortgage interest rate: 2.9%
Your current monthly repayment: 1000 approx
Your property's BER: A3
Are you due to get extra cashback from your current lender in the future: 2,400 if stay until 2026 (1% for further 2 years after 3 year term complete)

@sobs17 Your break fee should be zero at the moment – but confirm it with EBS. If it is higher than zero, please post it here when you receive it, including the date of the letter.

• Switching immediately to EBS's 4-year green fixed rate (2.1% and you would get the 1% (€2,400) cashback) will save you about €2,800 over the next 4 years. And it is very simple and quick to do (no bank statements, salary cert or solicitor, etc., needed).
  • I am assuming that you would get the €2,400 cashback in January 2026, but you should check this with EBS (and get it in writing if they say that you will get the cashback even if you switch to the green rate)
  
  
• Switching immediately to Haven's 4-year green fixed rate (2.0% with €2,000 cashback) will save you about €2,020 over the next 4 years
  
  
• Switching immediately to AIB's 5-year green fixed rate (2.15% with €2,000 cashback) will save you about €660 over the next 4 years
  • And it is quite likely that you will be able to make unlimited overpayments without penalty for the foreseeable future (see this thread)
  
  
• Switching immediately to Avant Money's 7-year fixed rate (2.25% with no cashback) will leave you worse off by about €2,280 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 (2.4% with no cashback) will leave you worse off by about €3,660 over the next 4 years – but with the longer security of 10 years on a fixed rate
  
  
• Switching immediately to Avant Money's "One Mortgage" (a 2.5% fixed rate with no cashback) will leave you worse off by about €4,560 over the next 4 years – and the interest rate will remain fixed for the remainder of your mortgage term (approximately 29 years)
  
  
• Switching immediately to Finance Ireland's 10- or 15-year fixed rate (2.9% with no cashback) will leave you worse off by about €8,220 over the next 4 years – but with the 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
  
  
• Switching immediately to Finance Ireland's 20-year fixed rate (3.0% with no cashback) will leave you worse off by about €9,140 over the next 4 years – but with the longer security of 20 years on a fixed rate
  • This product has a benefit in relation to moving home in the future that is explained below
  
  
• Switching immediately to Finance Ireland's 25-year fixed rate (3.15% with no cashback) will leave you worse off by about €10,520 over the next 4 years – but with the longer security of 25 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 2.1% rate with EBS when the current fixed rate ends. And that's assuming that EBS are even offering a 2.1% rate in January 2024 – it could be higher (or lower). I am assuming that you would get the €2,400 cashback in January 2026 if you switch to EBS's green rate, but you should check this with them. The estimates also account for any fees (solicitors' fees, valuation fee) that you have to pay and any cashback offered by 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 you can "take your mortgage with you" – meaning that you get to keep the same interest rate when you move (again, subject to certain conditions).

The estimates also assume that you get your loan-to-value ratio (LTV) below 60% so that you are eligible for some of the listed rates. (You are already eligible for EBS's 2.1% green 4-year fixed rate and for all of Haven's rates.) Your LTV is currently 235.0k/370.0k = 63.5%. A higher property valuation (€392k) and/or a few more monthly mortgage payments and/or a lump sum overpayment will get you below 60%. E.g., a valuation of €380k and a €7k lump sum overpayment would bring your LTV down to 60%.

Bear in mind that interest rates could rise between now and the time that you complete any switch, so if you are thinking of switching you should probably apply simultaneously to two or more lenders for approval in principle (AIP).

1, How long does the process take to switch provider as my zero break fee is in place until Friday? Or how much would this change by in the next few weeks?

It seems to be taking about three months to switch lenders at the moment. In your particular case it is unlikely that your break fee will rise above zero for the foreseeable future.