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Fixed mortgage questions

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  • 20-06-2009 11:46pm
    #1
    Marathon Man
    Registered Users Posts: 413 ✭✭


    With a fixed term mortgage for the next 10 years, can I get a mortgage from a different supplier? If so are there any charges involved?


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    #2
    Senna
    Registered Users Posts: 8,800 ✭✭✭Senna


    If you get a fixed rate from one bank you will not be able to move to another without paying the first bank a "breakage fee". The breakage fee could be any amount from a few hundred to the price of a new BMW. If it was a 10yr fixed rate and you look at moving early on in the rate, it will probably be closer to the BMW price.
    But breakage fees are worked out on what it costs the bank to let you out of it, so its impossible to guess what the fee would be in the future (interest rates change).

    Why would you fix for so long if you think you would change lender at some point in the future? Can you change lender now, then fix? Do you realise the drawbacks of fixing long term?


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    #3
    antoinolachtnai
    Registered Users Posts: 9,787 ✭✭✭antoinolachtnai


    Please think long and hard before fixing for long periods. This is especially the case where the cost of it is more than a point or so.

    Remember, the fixed rate is a facility you are paying a premium for. Is it really worth it? Do your sums. If you were on a variable and started paying extra into your mortgage when the rate is low, would you end up being better off? How high would the rate have to go and for how long, to make the fixed rate a good deal?


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