Topping up ulster bank mortgage to wipe out cu loan.

T

tom1ie

Registered User
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Hi all
I recently switched to ulster bank (March) and was asked at the time did we want a mortgage top up for home improvements, which we declined as we had no intention of doing home improvements.
A few months later and we are doing home improvements :rolleyes:!
We took out a credit union loan of 30k which is costing us 270 a month to service.
The ub mortgage is fixed at 2.3% for two years, so I’m wondering would ub let us top up by 30k now to wipe out our cu loan, which we would get at the rate of 2.3% instead of the cu’s 7.9%.
This would mean I’d free up 270 a month to go towards overpaying the mortgage. (I’m already overpaying the cu loan by 1000 a month so all this would now go off the mortgage.)
 
All depends on your loan to vaue ratio and income. The top up would be a separate loan to the main mortgage but could run along side it for same term and whatever rate they are offering now. Extra life cover would be needed to cover the additional amount.
 
Well you will have had a valuation done recently for the switch so should know straight away whether the loan to value ratio will work, other than that it's more complicated than a personal loan that you have from the credit union but cheaper so depends how much you want to save some money :)
 
I checked with BoI a few years ago and they would only allow equity release for future renovation work. Quite a lot of hassle involved with valuations before and after, certification of work done, etc.

My LTV at the time was 50% or so.

I am not sure if Ulster are any more lenient.
 
Banks seem to have lightened up a lot again, as the CU loan is so new it may be easier convince them it is for new home improvements, you may also need invoices/quotes etc and if it involves any element of structural work you would definitely need the relevant certification and there may be a retention until works are finished. Best to ask UB for definitive answer.
 
I was told by UB that they will give €30k for renovations (either retrospectively or prospectively) plus €30k for anything I want.
 
So ub have told me they will give the 30k but I have to do a mortgage application again. I won’t need a solicitor as it is under 60k. The repayments work out at an extra 115 a month as opposed to 270 with the cu........a no brained really. I wonder if I get the 1500 again..........:cool:. (wishful thinking!)
There is an option of doing getting a 30k personal loan but obviously the interest rate and repayments would endup costing me the same/more than the cu loan.
 
You're not doing a full new application although it looks the same, it's a top up application so not a brand new mortgage in the sense that the original one was, more like a sub account of the original. Up to date income details etc but processed in house and funds released directly, no need of a solicitor as mentioned. So no more free money :)
 
I did an extension about 5 years ago, needed €30k loan on top of savings to complete the work. UB where we've a LTV of less than 25% mortgage were a pain to go to, only would release money when invoices submitted etc..... took the loan from the CU at a higher cost but with nothing to submit only bank statements and payslips!
 
Those 5 yrs seem to have made a big difference to bank lending! It's slowly but surely getting back to 'normal'. Rules seem to have been seriously relaxed very quickly.
 
tom1ie said:
So ub have told me they will give the 30k but I have to do a mortgage application again. I won’t need a solicitor as it is under 60k. The repayments work out at an extra 115 a month as opposed to 270 with the cu........a no brained really. I wonder if I get the 1500 again..........:cool:. (wishful thinking!)
There is an option of doing getting a 30k personal loan but obviously the interest rate and repayments would endup costing me the same/more than the cu loan.
Click to expand...

Just remember it's an extra 115 over a much longer time period! Keep overpaying it anyway!
 
Good point! You should ask UB what would the repayments be on the top up over the same term as the CU loan, just for comparison purposes.
 
HollowKnight said:
Just remember it's an extra 115 over a much longer time period! Keep overpaying it anyway!
Click to expand...

I plan on overpaying the mortgage by the 1000 a month I was overpaying the cu loan plus the actual monthly repayment on the cu loan which is 270. So every overpayment I make brings down the cost of next months mortgage repayment.
 
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