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Mortgage Rates Renewal-Tracker Mortgage

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  • 08-06-2011 11:12am
    #1
    MildredW
    Registered Users Posts: 39 ✭


    Hi, just looking for a bit of advice. Our mortgage rates are up for renewal after our first 3 years being fixed at 6.25%. Suprisingly all the options offered are actually lower than what we have been paying!!

    We are with BOI and they have offered us a tracker variable at ECB + 1.25% which will be nearly 400 a month lower than what we are paying now. do people think it would be wise to take this tracker option they have offered, obviously we have been used to paying alot more than we would with this option so could afford if the ECB rates were to rise (to a certain degree) and does anyone know that if they were to start rising is it possible to then fix (at a more expensive fixed rate no doubt!)

    variable @ 3.45%
    2 yr fixed @ 4.95%
    3 yr fixed @ 5.45%
    5 yr fixed @ 6.05%

    Any advice is greatly appreciated!! Thanks in advance. :)


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    #2
    halkar
    Registered Users Posts: 1,257 ✭✭✭halkar


    I did not know the banks were still offering trackers. I would take the tracker offer if I were you. ECB rates will raise but I do not think it will rise much in 5 years. Even if ECB rates goes up to 4% your tracker will be at 5.25% which is still lower than the 3 and 5 year fixed.


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    #3
    MildredW
    Registered Users Posts: 39 ✭MildredW


    Thanks for your reply. Yes i was suprised they offered me that too, i didnt think they were been offered anymore seeing as the bank are at such a loss with them?! perhaps it was in the terms and conditions when i got my mortage in 2008? to be honest i'm happy that even with the 5 yr fixed it will still be lower than what we were paying. normally with my luck its the other way round :p


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    #4
    Anatom
    Registered Users Posts: 1,165 ✭✭✭Anatom


    Snap their hands off...

    Bear in mind though that rates will be increasing across the board (variable and fixed) in the coming years, so your repayments will be increasing. If you've got ECB+1.75%, you'll be paying the lowest you can get with BOI.


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    #5
    phormium
    Registered Users Posts: 3,340 ✭✭✭phormium


    Take the tracker.

    They are offering it because they have to, it was obviously on your original loan offer that you would revert to tracker.

    Put the extra money that you were used to paying into a regular savings account as a cushion against rate rises.


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    #6
    coxyboy
    Registered Users Posts: 22 ✭coxyboy


    Take the tracker and overpay each month up to the amount you are currently paying, this will reduce your mortgage term and/or the amount you owe before higher rates are applied. If you take the option of saving the extra amount, you'll be hit with DIRT and inflation is also on the rise. Anyway saving rates are not that good at the moment.


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