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Mortgage Advice – Variable mortgage AIB or BOI

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  • 08-08-2012 11:19pm
    #1
    Matt406
    Registered Users Posts: 190 ✭✭


    Hi All,

    Just looking for people’s thoughts on the following – after 4 months of going around in circles with AIB & BOI on mortgage applications we now have approval from both of them within 2 days of each other!! I know that AIB’s rate is currently better than BOI’s but do people think that this is likely to remain the case? Anyone have any options on which bank to go with (long term) or should I just be choosing the one with the cheapest rate at the moment? Thanks


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    #2
    muffler
    Registered Users Posts: 46,082 ✭✭✭✭muffler


    Not really for the Prices/costs forum. Moved to banking.


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    #3
    dotsman
    Registered Users Posts: 3,636 ✭✭✭dotsman


    Over the life of a mortgage - not a clue - impossible to predict
    In the short term, possibly AIB. They have been far cheaper for a long time now, and given that the government have a larger stake in them than BOI, there will be far more political pressure on them to keep rates low.

    With regards the recent hike and statement that there may be more - you can read it either way:
    • The statement that "there may be more" might mean they become more expensive than BOI
    • Given the media/political backlash, they may wait until all the other banks raise their rates before they do so again and, thus, continue to be the cheapest.
    To be honest, I wouldn't bet on any bank's rates in a year's time. Given a mortgage is for 25-35 years, it really is a flip of a coin between AIB/BOI


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    #4
    Tow
    Registered Users Posts: 7,370 ✭✭✭Tow


    There is a very old rule with banks. Don't have loans with the bank you have your money in, if you don't pay the loan and they see money in your other account(s) they can take the money to pay the loan.

    When is the money (including lost growth) Michael Noonan took in the Pension Levy going to be paid back?



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    #5
    dotsman
    Registered Users Posts: 3,636 ✭✭✭dotsman


    Tow wrote: »
    There is a very old rule with banks. Don't have loans with the bank you have your money in, if you don't pay the loan and they see money in your other account(s) they can take the money to pay the loan.

    Why would you not repay your loan when you have money?

    Also, banks would only move to take money from your other accounts long after your account has gone into arrears and they are in the legal/recovery stage. Therefore, if one is intending to defraud the banks, they can easily move their savings/deposits far in advance of that happening.


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    #6
    Tow
    Registered Users Posts: 7,370 ✭✭✭Tow


    dotsman wrote: »
    Why would you not repay your loan when you have money?

    When putting food on the table for your children is more important than servicing a banks loan.

    When is the money (including lost growth) Michael Noonan took in the Pension Levy going to be paid back?



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    #7
    [Jackass]
    Closed Accounts Posts: 9,193 ✭✭✭[Jackass]


    Banks can never touch your savings / income in your account without your consent. If you have 1 million in your account and you owe 1 million and refused to pay your loan they would have to take you to court and get an order before they could touch your money.

    However, should arrears ever arise, it would be beneficial to have your savings / money in a separate bank than the one you are borrowing from in terms to negotiating position on arrears, as the bank would push to take the maximum disposable income possible and have the facts, but you could maybe give yourself more room for comfort if they don't have access to your financial health, but that's really a different issue.

    In terms of which bank to borrow from now, I would suggest to go with whats most beneficial in the immediate term. AIB would have the better rates and there is no gaurentee that if you paid more with Bank of Ireland now, it would somehow work out better in the long run.

    There's not much competition from banks at the moment and little to lend, so a rate war is unlikely any time soon. Stick with who's best for now, avoid fixing into a rate and you always have the option to switch at any time if there is a big difference in rates down the line, just be sure that you're paying the same if not more capital portion of the payment with the new mortgage in order for it to be beneficial over the life of the loan. (i.e a better rate but on a longer term will obviously mean you pay more in total by the end of the loan).


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    #8
    dotsman
    Registered Users Posts: 3,636 ✭✭✭dotsman


    Tow wrote: »
    When putting food on the table for your children is more important than servicing a banks loan.

    It should never get to that. Whatever about other expenses, no bank, nor any court would ever expect a person, or any of their children, to "go hungry".

    If a person ever finds themselves in that position, they need to talk to their bank/MABS immediately.


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