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Mortgage Rate

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  • 16-11-2012 9:51am
    #1
    MaggieMc74
    Registered Users Posts: 37 ✭


    Hi,

    I recently came off a fixed rate. The interest rate went down by .75% to the now variable rate. However the bank sent out a letter saying what my repayment would be and its exactly the same as the fixed interest rate which was .75% higher! How can this be? I have the house seven years.

    Any ideas would be appreciated.

    Thanks,

    Regards,
    MaggieMc


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    #2
    peteb2
    Registered Users Posts: 1,813 ✭✭✭peteb2


    Did it give the figure nett of mortgage interest relief? Has your morgage interest relief run out?


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    #3
    donalg1
    Closed Accounts Posts: 3,513 ✭✭✭donalg1


    MaggieMc74 wrote: »
    Hi,

    I recently came off a fixed rate. The interest rate went down by .75% to the now variable rate. However the bank sent out a letter saying what my repayment would be and its exactly the same as the fixed interest rate which was .75% higher! How can this be? I have the house seven years.

    Any ideas would be appreciated.

    Thanks,

    Regards,
    MaggieMc

    Not sure exactly how that could be, but if you are paying the same amount but on the lower interest rate you will be paying more off the capital which wouldnt be a bad thing, provided you can manage the payments as is.

    If I remember correctly the repayments dont change too much over the course of the mortgage but the ratio of capital:interest would change with the interest rate changes. (Could be completely wrong on that one though)

    For example say the mortgage is €100k and is to be repaid over 30yrs, then there will be some capital amount of say €500 that would have to be paid each month in order to clear the €100k within the 30yrs, so this €500 wouldnt ever change and the interest is added to this €500, now obviously with a change in interest rate the interest portion should reduce meaning the repayments reduce so why yours havent I am not sure. It could be something to do with TRS maybe after the 7 years.


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    #4
    MaggieMc74
    Registered Users Posts: 37 ✭MaggieMc74


    Hi

    Thanks for that. The letter I am sure(don't have it with me) was a gross figure. My mortgage have change significately since I took it out for the past year and a half its been 200 euros more a month then when I first started due to interest rates so that's why I was surprised by the same figure.

    Regards,


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    #5
    kieran.
    Registered Users Posts: 1,174 ✭✭✭kieran.


    Just a question where you on a variable rate before you took out your fixed rate or a tracker? The reason i ask is you may be entitled to your tracker back even if the bank hasn't offered it it. From my own experience i came of a fixed rate 4.1% was offer a variable rate at 3.85% but I argue with the bank i should have got my tracker rate back according to the term of the Fixed rate agreement and my original loan offer. long story short i'm now on 1.8% :D:D:D.


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    #6
    MaggieMc74
    Registered Users Posts: 37 ✭MaggieMc74


    Hi

    I was on fixed for the first four years, went fixed again for another two, and was fixed up to this October. I am now on variable which is less than the fixed interest rate they are offered me.

    Regards,

    MaggieMc


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    #7
    peteb2
    Registered Users Posts: 1,813 ✭✭✭peteb2


    I'm all for people being aware of things, but maybe you shouldn't go around giving people false hope over things. I've read so many posts these days where people just don't understand their own situations and are posting things like "my bank never offered me a tracker rate when i first took out my mortgage, should I not have got one, I'm off to the FSO!"


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