Loan to value

Cape Clear

KCross wrote: »

Got EXACTLY the same response when I first asked AIB.
I threatened to move mortgage provider and they came back with "ok, just this once!"

Out of interest who did you contact?

KCross

Cape Clear wrote: »

Out of interest who did you contact?

Just some randomer in the branch where I originally got the mortgage. They just process the paper work. The decision is made in Dublin.

Looking at the current rates you are probably paying 3.15%. If you can get yourself into the 50-80% bracket you will get that down to 2.95%.

There aren't that many(any?) offering rates better than 3.15% at the moment. TSB are offering fixed new business rates around 3% so you could threaten them with a switch to them. All the others seem to be above the 3.15% rate so you'd have no leverage there.

Ulster Bank have a 3% rate as well for mortgages above 200k with LTV of <60%. You might fit that criteria.

April 73

KBC spontaneously wrote to me last week saying that I should get in touch if I felt my LTV was better than when I took the mortgage out. I will be able to move from the 60% bracket to below 50% I reckon.
Going to pick up the phone now after reading this. I'd just been lazy & hadn't taken any action on it.
First time I've ever seen the bank keen to offer rate reductions!

Truckermal

machalla wrote: »

About 6-12 months from what I've seen on various forums. Some banks may accept it sooner. I remember someone on askaboutmoney claimed they had switched mortgage 3 times in a year to take advantage of cashback deals which can't be clawed back as has been mentioned already.

Does that really work? I'm impressed at the thought though!

Danbo!

Truckermal wrote: »

Does that really work? I'm impressed at the thought though!

No reason it shouldn't. Switching is a bit of work gathering statements for all accounts, passports, salary certs, etc and trips to the bank, but it would actually be easier to switch frequently in close succession and use the same correspondence.

Personally, last thing I want to do after going through the switching process is go through the switch process

CreativeSen

A few questions on this.

We just bought a house and were expecting to pay a 20% deposit. When the moment came that the bank took the funds out of the account they took ever so slightly more than 20%. In real terms it was about 600 EUR but percentage wise it was 20.1%.

1. - is this normal/standard practice?
2. - does that 0.1% increase in the deposit put us into a different rate bracket?

Interested Observer

Danbo! wrote: »

No reason it shouldn't. Switching is a bit of work gathering statements for all accounts, passports, salary certs, etc and trips to the bank, but it would actually be easier to switch frequently in close succession and use the same correspondence.

Personally, last thing I want to do after going through the switching process is go through the switch process

It's not just hassle, it's also quite expensive to switch providers, your solicitor has to get involved again etc so there are legal fees and whatever else. So you have to factor that in as well, make sure you're going to save back at least the costs through cashback or reduced interest or else it isn't worth it.

TheShow

CreativeSen wrote: »

A few questions on this.

We just bought a house and were expecting to pay a 20% deposit. When the moment came that the bank took the funds out of the account they took ever so slightly more than 20%. In real terms it was about 600 EUR but percentage wise it was 20.1%.

1. - is this normal/standard practice?
2. - does that 0.1% increase in the deposit put us into a different rate bracket?

Why was the bank taking money out of your account?
You pay the 20% deposit to the vendor of the property via solicitor, not to the bank.
The bank gives you a mortgage for the remaining 80%.

Maybe it was a bank transfer to the solicitor that you are referring to? whch can only be done on your instruction and you should specify the amount. I'd certainly be asking the bank why more funds were taken than you authorised.

iluvfatfrogs

TheShow wrote: »

Why was the bank taking money out of your account?
You pay the 20% deposit to the vendor of the property via solicitor, not to the bank.
The bank gives you a mortgage for the remaining 80%.

Maybe it was a bank transfer to the solicitor that you are referring to? whch can only be done on your instruction and you should specify the amount. I'd certainly be asking the bank why more funds were taken than you authorised.

Was it possibly the actual payment to the solicitor who included their fee (or stamp duty) also?

Danbo!

Interested Observer wrote: »

It's not just hassle, it's also quite expensive to switch providers, your solicitor has to get involved again etc so there are legal fees and whatever else. So you have to factor that in as well, make sure you're going to save back at least the costs through cashback or reduced interest or else it isn't worth it.

Its generally solicitors fee + valuation fee. Solicitor is about €1k, valuation €150. Any bank offering cash back deals will usually cover this amount and more:
PTSB 2% (300k mortgage would be 6k cash)
EBS 2%
AIB €2k
KBC €3k
Ulster €1.5k
BOI 2% (+1% in 5 years)

etc.

All the above cover costs in most cases, and you'll have a few quid left for your troubles. In most cases, you need to have the fees yourself as the cash back deals come after mortgage drawdown.

iluvfatfrogs

iluvfatfrogs wrote: »

This is a very good thread - how about my situation:
Mortgage LTV (based on purchase price) was exactly 80% (i.e. 20% deposit).
However, based on the banks valuation at the time of drawdown, the LTV was actually 73%.
I'm presuming my fixed interest rate was calculated on 80%+ as opposed to 50-80%?

Would it be worth me looking into breaking the fixed term (at a cost obv) to secure the lower rate related to 50-80%, especially as there has only been 12 months payments against the principal, so any drop is significant?

Update: €214,000k mortgage balance, 15 months into a 36 month fixed term 3.65% rate, will cost €1,600 to break

Option to select 2.95% variable but I’d only break even over the 21 months period , (assuming rate remains unchanged) or opt to fix for 3-5-7 years at a Lower rate than I’m currently on

Danbo!

iluvfatfrogs wrote: »

Update: €214,000k mortgage balance, 15 months into a 36 month fixed term 3.65% rate, will cost €1,600 to break

Option to select 2.95% variable but I’d only break even over the 21 months period , (assuming rate remains unchanged) or opt to fix for 3-5-7 years at a Lower rate than I’m currently on

Is that with the same bank? Would you consider changing to avail of cash back offers to soften the blow of €1,600?

I’m two weeks into switching process and it’s actually been quite easy, letter of offer has just been sent to solicitor so most hard work done. Even tho I work next door to bank, almost all correspondence has been via email. Did have to visit once to sign forms (also switching current acc and credit card to same bank) so needed wife with me as all will be joint accounts.

retalivity

April 73 wrote: »

KBC spontaneously wrote to me last week saying that I should get in touch if I felt my LTV was better than when I took the mortgage out. I will be able to move from the 60% bracket to below 50% I reckon.
Going to pick up the phone now after reading this. I'd just been lazy & hadn't taken any action on it.
First time I've ever seen the bank keen to offer rate reductions!

I got the same letter from them a few weeks ago, reckon its something to do with the ongoing tracker scandal - keep customers onside.

Bought a year ago, 10% deposit. Got revalued today and ltv is 65%, a combination of some overpayment but mainly crazy dublin prices. Variable rate now going down to 3.1%, paying the same and reducing the term by about 2 yrs

iluvfatfrogs

Danbo! wrote: »

Is that with the same bank? Would you consider changing to avail of cash back offers to soften the blow of €1,600?

I’m two weeks into switching process and it’s actually been quite easy, letter of offer has just been sent to solicitor so most hard work done. Even tho I work next door to bank, almost all correspondence has been via email. Did have to visit once to sign forms (also switching current acc and credit card to same bank) so needed wife with me as all will be joint accounts.

It is with Same bank (AIB), so no cash back applies, not sure if any of the banks with cash back offers have as low as rate? But open to correction on yhat

Danbo!

iluvfatfrogs wrote: »

It is with Same bank (AIB), so no cash back applies, not sure if any of the banks with cash back offers have as low as rate? But open to correction on yhat

Not that I know of. They’re the bank I’m changing to because of the rate

PaulKK

KCross wrote: »

Just some randomer in the branch where I originally got the mortgage. They just process the paper work. The decision is made in Dublin..

Did you just rock into the branch with a new valuation?

I got the same spiel. Coming to the end of 3 year fixed with aib @ 3.8% and I might just nick it under the 50% ltv now. Original loan was taken on ltv > 80% almost 6 years ago and they claim you can only have one ltv rate for the life of the mortgage.

Was there any particular thing you did to get them to change their tune? My original plan was to send in an approval in principle from another lender with the new valuation.

KCross

PaulKK wrote: »

Did you just rock into the branch with a new valuation?

Not quite. I discussed it with them over the phone/email first and they said no, giving the same stock answer of "only one LTV rate for the lifetime of the mortgage"!

I then threatened to move mortgage by saying I had approval. They then relented and gave me their valuation form and a list of approved valuers. I went to one of them and got it filled in. They have to come out and inspect the house and give examples of other houses in the area and what they sold for etc. You have to pay them to fill that form in (€100+)

Send that form in to the branch and they forward to Dublin for approval and that was it.

PaulKK

KCross wrote: »

Not quite. I discussed it with them over the phone/email first and they said no, giving the same stock answer of "only one LTV rate for the lifetime of the mortgage"!

I then threatened to move mortgage by saying I had approval. They then relented and gave me their valuation form and a list of approved valuers. I went to one of them and got it filled in. They have to come out and inspect the house and give examples of other houses in the area and what they sold for etc. You have to pay them to fill that form in (€100+)

Send that form in to the branch and they forward to Dublin for approval and that was it.

Did you have approval? Did you go in to the branch and tell them you were moving or did you do that over the phone?

I've already called them months ago and got the stock answer.

KCross

PaulKK wrote: »

Did you have approval? Did you go in to the branch and tell them you were moving or did you do that over the phone?

I've already called them months ago and got the stock answer.

No, I bluffed! It was done via email & phone. I did quote a specific bank and rate, that they were offering, which was better than AIB so they knew there was a possibility of losing me. You don't have to prove you have approval. Thats a gamble they have to take.


The worst that can happen is they call your bluff and you either have to go away and get approval or you stay with them... you won't be worse off either way.


The thing for you now is, is there a bank out there offering a better rate than what AIB are giving you. If there isn't then you have nothing to bluff with.

What rate are you going onto with AIB when your 3yr fixed rate finishes and is there a 50% LTV rate being offered by another bank that beats that rate?

Teyla Emmagan

PaulKK wrote:

I've already called them months ago and got the stock answer.

Who did you say you were moving to? Because AIB/EBS/Haven are the same business so if you said you would leave Haven for AIB they mightn't be too bothered.

lawred2

PaulKK wrote: »

Did you just rock into the branch with a new valuation?

I got the same spiel. Coming to the end of 3 year fixed with aib @ 3.8% and I might just nick it under the 50% ltv now. Original loan was taken on ltv > 80% almost 6 years ago and they claim you can only have one ltv rate for the life of the mortgage.

Was there any particular thing you did to get them to change their tune? My original plan was to send in an approval in principle from another lender with the new valuation.

Only one ltv for life of mortgage... lol

rsynnott

KCross wrote: »

Not quite. I discussed it with them over the phone/email first and they said no, giving the same stock answer of "only one LTV rate for the lifetime of the mortgage"!

I then threatened to move mortgage by saying I had approval. They then relented and gave me their valuation form and a list of approved valuers. I went to one of them and got it filled in. They have to come out and inspect the house and give examples of other houses in the area and what they sold for etc. You have to pay them to fill that form in (€100+)

Send that form in to the branch and they forward to Dublin for approval and that was it.

Huh, interesting; I’m in the same situation but hadn’t even tried. Though now that they’re the cheapest it probably isn’t a very credible threat

PaulKK

Teyla Emmagan wrote: »

Who did you say you were moving to? Because AIB/EBS/Haven are the same business so if you said you would leave Haven for AIB they mightn't be too bothered.

I didn't mention any other lender, I was just enquiring about switching to a lower ltv once the fixed term is up.

I may have to wait for another lender to drop their lower ltv rates as aib seem to be the lowest for me at the moment.

KCross wrote: »

What rate are you going onto with AIB when your 3yr fixed rate finishes and is there a 50% LTV rate being offered by another bank that beats that rate?

I'm going to be put back on the svr which I think is 3.15, unless I choose to fix again.

KCross

PaulKK wrote: »

I'm going to be put back on the svr which I think is 3.15, unless I choose to fix again.

If the mortgage is >€250k TSB have a 2.95% rate if the LTV is <60%.

Ulster Bank have a 3% rate if the mortgage is more than €200k for LTV <60%.


You could beat them over the head with those?

PaulKK

KCross wrote: »

If the mortgage is >€250k TSB have a 2.95% rate if the LTV is <60%.

Ulster Bank have a 3% rate if the mortgage is more than €200k for LTV <60%.


You could beat them over the head with those?

Thanks that might work. The Ulster rate would apply to me.

baldbear

I'm dragging up a thread but after seeing the rates Ulster bank are now offering I'm going to ring Aib & asking for a better rate.

We are LTV of <80 % now & the 2.95% should apply to us.

Is calling the mortgage team the best option or calling into branch & are they still trying to fob people off?

Any advice or experience people out there? Thanks

hanaimai

On this topic, it's worth noting that from 1 January 2019, banks will be required to inform consumers (on variable rates) annually whether or not they can move to a cheaper interest rate (with that lender) based on their LTV lowering, subject to an up to date valuation.