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Variable rate mortgage term

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  • 11-06-2015 10:35am
    #1
    Head_Hunter
    Registered Users Posts: 683 ✭✭✭


    Is there any advantage of a 5 year variable mortgage? Why not just get a 30 year variable mortgage, pay it off early and have the advantage of a small repayment commitment?


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    #2
    godtabh
    Moderators, Science, Health & Environment Moderators Posts: 23,218 Mod ✭✭✭✭godtabh


    Is there a such thing as a 5 year variable rate? Generally variable rates are indefinite. Fixed rates are for a period of time.

    Given the high rate of mortgages in arrears a lot of people cant afford to pay back mortgages early.


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    #3
    Head_Hunter
    Registered Users Posts: 683 ✭✭✭Head_Hunter


    bonkers.ie etc all ask for a motgage term length for variable rate mortgages


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    #4
    Michael D Not Higgins
    Registered Users Posts: 7,223 ✭✭✭Michael D Not Higgins


    If you can afford to pay off a mortgage in 5 years and there's no penalties for early repayments, sure, go for the 30 year mortgage for the flexibility.


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    #5
    colm_c
    Registered Users Posts: 2,031 ✭✭✭colm_c


    Head_Hunter wrote: »
    bonkers.ie etc all ask for a motgage term length for variable rate mortgages

    That's just the length of the mortgage itself not the variable term. The variable runs for the length of the mortgage unless you decide otherwise.

    With a fixed, it's the first X years that are fixed then it usually reverts to variable for the rest of the mortgage.


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    #6
    NewCorkLad
    Registered Users Posts: 957 ✭✭✭NewCorkLad


    It depends how disciplined you are. If you can save the excess money to pay off the mortgage early without dipping into it on a regular basis, the longer term mortgage would give you greater flexibility and freedom, however if you feel you wouldnt be able to trust yourself with the excess funds just sitting there, a shorter term mortgage would force you to be disciplined.

    As said above the term is just in relation to the term of the mortgage and has nothing to do with the variable rate.


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