Switching mortgage

Lycoge

Hi

We are coming out of our first 3 year fixed term with BOI in a few months. Starting to look around for best rates and weigh up options.

A post on the "Saving for a mortgage" thread mentioned needing to organise new mortgage protection which isn't something I had considered and is something I'd rather not have to do.

BOI don't have the best fixed rates on the market but it may be best to stick with them if the process involves more than I had initially considered.

So looking for advice on things that need to be considered before switching from people who have gone through the process. Is it basically a full new application similar to the initial purchasing process?

Solicitors fees
New mortgage protection
New valuation of property
Negotiating rates with current bank (?)

Thank you

gud

Just out the other side after switching from EBs to Ulster. No it wasn’t easy, as in time consuming... and yes to all your questions. However Ulster paid for everything, valuation and solicitor. I’ve reduced my mortgage repayments by over 100 a month plus life insurance and knocked 2 extra years off my repayments. So I’m very happy with that. Took 3 months to complete but possibly should have been done sooner

pnecilcaser

gud wrote: »

Just out the other side after switching from EBs to Ulster. No it wasn’t easy, as in time consuming... and yes to all your questions. However Ulster paid for everything, valuation and solicitor. I’ve reduced my mortgage repayments by over 100 a month plus life insurance and knocked 2 extra years off my repayments. So I’m very happy with that. Took 3 months to complete but possibly should have been done sooner

Did you go for the fixed term offering from Ulsterbank?

I recently tried to switch my mortgage to make a saving on the rates but unfortunately my employment situation had changed since I got the mortgage and even though I have never missed a payment and have been OVERPAYING the mortgage they wouldn't allow me to switch as my current demonstrable income was classified as "below threshold". This made me laugh. It is down to timing, I get all my overtime from now until the end of the year so the last 6 months of payslips don't reflect the much larger amount of of money I earn (even though I had three years of p60s to show this).

I will be able to switch mortgage in 6 months time when I look better on paper.

Alkers

pnecilcaser wrote:

I will be able to switch mortgage in 6 months time when I look better on paper.

Did you ask ebs to match the rate?

Lycoge

Simona1986 wrote:

Did you ask ebs to match the rate?

We'll be doing this when it comes time to renew our fixed rate. Not sure if it will be entertained or if it is something banks normally do to keep their mortgage customers.

gud

pnecilcaser wrote: »

gud wrote: »

Just out the other side after switching from EBs to Ulster. No it wasn’t easy, as in time consuming... and yes to all your questions. However Ulster paid for everything, valuation and solicitor. I’ve reduced my mortgage repayments by over 100 a month plus life insurance and knocked 2 extra years off my repayments. So I’m very happy with that. Took 3 months to complete but possibly should have been done sooner

Did you go for the fixed term offering from Ulsterbank?

I recently tried to switch my mortgage to make a saving on the rates but unfortunately my employment situation had changed since I got the mortgage and even though I have never missed a payment and have been OVERPAYING the mortgage they wouldn't allow me to switch as my current demonstrable income was classified as "below threshold". This made me laugh. It is down to timing, I get all my overtime from now until the end of the year so the last 6 months of payslips don't reflect the much larger amount of of money I earn (even though I had three years of p60s to show this).

I will be able to switch mortgage in 6 months time when I look better on paper.

Yes I went with the 4 year fixed rate of 2.6% with €1500 cash back towards solicitor fees.

gud

Simona1986 wrote: »

pnecilcaser wrote:

I will be able to switch mortgage in 6 months time when I look better on paper.

Did you ask ebs to match the rate?

I met with EBS before moving, told them my intentions and what Ulster bank were offering. The offered me the going rate the had on there system, no bargaining, even though we were perfect clients. When it finally came to moving and all the hassle was near the end, they did offer me a an improved rate but it was still not near the fixed rate Ulster bank offered.
I don’t get it, why lose a loyal customer with a 100% clean record.....

4ensic15

gud wrote: »

I don’t get it, why lose a loyal customer with a 100% clean record.....

Cash flow, reducing their exposure to the property market. Reducing exposure is driving much of the activity (or inactivity) in the mortgage market at the moment.

milhous

If we change our current mortgage, we'd get about 7k cash back(and apparently another 3.5k in few years), a 7 year fixed rate that is 0.5%lower than our current banks fixed rate (without the cashback). It's kind of a no brainer except for all the hassle.

But just on the question of bartering with your current bank, I presume mortgage rates are a job for the banks underwriters etc. and your bank manager can't play about with them?
I'd love to switch but we're both self employed and the hassle of going through all that the mortgage application entails is a massive pain in the hole.

TheShow

milhous wrote: »

If we change our current mortgage, we'd get about 7k cash back(and apparently another 3.5k in few years), a 7 year fixed rate that is 0.5%lower than our current banks fixed rate (without the cashback). It's kind of a no brainer except for all the hassle.

But just on the question of bartering with your current bank, I presume mortgage rates are a job for the banks underwriters etc. and your bank manager can't play about with them?
I'd love to switch but we're both self employed and the hassle of going through all that the mortgage application entails is a massive pain in the hole.

The business normally set the rates, underwriters wouldnt have anything really to do them, they are just interested in the credit risk.

milhous

TheShow wrote: »

The business normally set the rates, underwriters wouldnt have anything really to do them, they are just interested in the credit risk.

Is there discretion to match rates of other banks as opposed to losing customers? I presume not as everyone would be looking and getting them.

TheShow

milhous wrote: »

Is there discretion to match rates of other banks as opposed to losing customers? I presume not as everyone would be looking and getting them.

I don't think so. maybe some very small leeway, like less than 0.05%. but nobody wants to get into a race to the bottom on rates again.

KingCong

milhous wrote: »

Is there discretion to match rates of other banks as opposed to losing customers? I presume not as everyone would be looking and getting them.

BOI will drop their rates to 0.2% below their advertised rates if you ring them and say your planning to switch. They called me back within an hour and offered 1, 3 or 5 year fixed for 2.8% and 10 year fixed for 3.1%. Still may work out better to switch to another bank for the cashback or UB/KBC for a better fixed rate, but if a BOI customer doesn't want the hassle of switching its a good option.

Lycoge

Op here with an update. Bank of Ireland issued a letter to us, unrequested, a few weeks ago to advice of new rate options as we were coming to the end of our fixed term this month. When I contacted BOI to query re submitting a valuation which would bring us from >80% LTV to 70-80% LTV, I was advised the offers they sent should have reflected the lower LTV of 71% (which is lower than what we had estimated based in sales in our area). They then issued a letter with better rates based on the lower LTV without the need for a valuation report which i was surprised by (positive in a rising market, but would be negative in a falling market). Once I had received those rates I phoned to say we have looked at competitors and considering switching unless BOI could match the KBC 3.2% 10 year/ Ulster Bank 2.99% 7 year rates. They came back and offered .1% off 1-5 year fixed term (3% reduced to 2.9) and 3.2% for 10 year fixed term (0.1 reduction), 3.6% variable. Not quite as good a deal as the previous poster who managed to get 3.1 on 10 year but useful for other BOI mortgage holders to know that you can certainly request a better deal and match the competition. How much I guess depends on your negotiation skills! 3.2 10 years fixed will do us.
I also asked re reducing the term of the loan (32 to 25 years) advised you can send a letter to the bank to request that and they will calculate your new (higher) monthly rate over 25 years.

But interestingly, I was also advised that there is another option rather than committing to the shorter 25 year term: let the mortgage roll into the variable rate for a day or two, contact them to agree a monthly overpayment over 32 years on variable rate which would match the higher monthly payment if you had gone to the shorter 25 year term. Once thats confirmed, contact them to let them know you want to move to a fixed rate.. your previously agreed monthly payment on the variable (e.g. 1500) transfers across as a monthly payment to the fixed rate but leaves you with the flexible option, if ever needed, to reduce back down to what your fixed rate payments would have been without the overpayment (e.g. 1300).

Hope that's clear, but advise is to ask re options of better rates and to anyone looking to reduce their term, ask what options are available to reduce term.