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Future tracker mortgage arrangements..

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  • 30-04-2011 6:05pm
    #1
    Trotter
    Closed Accounts Posts: 5,362 ✭✭✭


    Here's a hypothetical question out of sheer curiosity having seen PTSB's little offer earlier last week..

    Lets say a person has a tracker mortgage in bank A and theres a remaining mortgage of €180k.

    Lets say also that an offer arrives out of the blue for €130k. Could the person chance their arm and inform the bank that they are not really pushed on leaving the house, but are in a position to close the mortgage, tracker included for 130k. Would the bank ever consider taking the money and closing the account in order to shut down the tracker and take the cash?

    Alternatively.. If the owners actually did really want to sell the house and there was a 50k difference between the mortgage amount and the value of the house, would the bank be likely to be keen to do a deal where they provide the mortgage for the new house but also packaging in the 50k negative equity? The bank then gets the well serviced 180k tracker off the books, replacing it with a new mortgage +50k on a fixed or variable rate.
    The home owner brings the negative equity with them. Win Win?


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    #2
    unclebill98
    Registered Users Posts: 3,816 ✭✭✭unclebill98


    If you where a car dealer and someone came in and offered you 13k for a brand new car worth 18k, do you think you'd sell just because you had lots of new cars? I think not.

    As for your 2nd idea, the new loan has no security as the house is now sold. Unless proper security was in place it would not be a runner. It would also be highly un likely as new loan would not have the same long term as the mortgage so the re payments could end up just as much or more than the original mortgage.

    But tbh there is no harm in asking!


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    #3
    Trotter
    Closed Accounts Posts: 5,362 ✭✭✭Trotter


    The first scenario is different to the car example though considering how much trackers are costing the banks. If it was fixed or variable then I agree there's no chance!

    I wish I was in the situation to try it out :)


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    #4
    unclebill98
    Registered Users Posts: 3,816 ✭✭✭unclebill98


    Well in the long term the car bit has some relevance.

    Would be nice to put the question to a bank. But they are big business and it would not make good business sense to let someone of the hook like that. Can not see that happening.


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    #5
    doyleju
    Closed Accounts Posts: 1 ✭doyleju


    This article would suggest that it might be something a bank would consider ?
    http://www.independent.ie/business/personal-finance/how-much-of-a-payoff-should-you-get-to-give-up-your-tracker-2634564.html

    A broker I spoke to said he has not heard of the banks doing any deals like this as yet ... He said the banks are currently only doing deals with people who are in arrears ....

    but just found this ... 10% discount for lump sum payments
    http://www.independent.ie/business/personal-finance/property-mortgages/mortgage-holders-to-get-10pc-bonus-for-paying-lump-sum-off-trackers-2622209.html


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