Mortgage - low fee for breaking fixed rate

loyatemu

I broke a 3 year fix and went to 5 years at the same rate. Hopefully in 5 years time things will have settled down a bit; or they'll have gotten so much worse that interest rates will be the last thing on our minds 😬

CFC007

Has anyone had issues with getting the Deeds from BOI. Seems to be very slow which is holding up the switch. They have been pinged twice now.

chases0102

Is it a case that until actual drawdown occurs, the rate you've agreed with your bank could go up? As in, even if you've AIP, just waiting for deeds or loan offer....until it's a done deal you might not get the rate you've applied for?

Began process at end of June and this is where we're at, worried we'll be screwed

bazz26

It depends on the bank and how far along the process you are at. If you at an advanced stage where they have already made the mortgage offer to you then they more than likely will honour the rate you agreed at. They might put a hard stop date on the morgage offer drawdown in order to keep the old rate. I think on average it's 6 months from when the mortgage offer is made to you, but there can be exceptions to extend it a bit depending on the circumstances. Best talk to your mortgage lender.

marvsins

Was due to finish 5 year fixed at 3% with EBS next June. Rang on Friday about breaking and offer. No break fee and I'm fixing at 2.75% for another 5 years.

Regarding comments on EBS breaking fees. We had a small top-up two years after original mortgage. It is a separate loan account. Paid off that loan of 22k about two years ago and there was a charge of about 250euro.

DeKing

Currently have 3 years left on a fixed rate @ 2.8% with Finance Ireland. Got a letter after enquiring with them as to what my options are,

3 years @ 3.50%

5 years @ 3.55%

10 years @ 3.15%

15 years @ 3.15%

20 years @ 3.25%

Kinda inclined to stay on the 2.8% with 3 years left and hopefully rates will be something similar when the 3 years is up.

walterking

https://www.boards.ie/discussion/comment/119815494#Comment_119815494

I'd probably take 10years at 3.15%

The peace of mind it will bring for a small bit extra would be worth it.

Rates will stabilise and then start dropping back in 2024, but probably only drop back to 2% which is the ECBs long term aim

Soarer

https://www.boards.ie/discussion/comment/119815579#Comment_119815579

Same as.

10 years @ 3.15% is a decent offer in this day and age.

Cape Clear

https://www.boards.ie/discussion/comment/119815579#Comment_119815579

Have the ECB stated that a 2% interest rate is their long term aim? Don't recall seeing that before or are you confusing it with their aim regarding inflation?

Padraig Mor

https://www.boards.ie/discussion/comment/119816948#Comment_119816948

ECB's stated long term policy is for a 'neutral' interest rate (neither stimulating nor restricting the economy) of 1.5 - 2% (generally trending towards the latter) and it is generally *expected* that rates will settle there after rising higher for a period. One point to note is that - as far as I know, but open to correction - this neutral rate refers to the ECB's deposit rate which is different than the main refinancing rate which is what influences mortgages (if you have a tracker, this is what it's pegged to). While it varies somewhat, for most of the last couple of decades this main rate has been 0.5 - 0.75% higher than the deposit rate indicating a *possible* 'neutral' main rate could be in the region of 2.0 - 2.75%.....and then add your bank's margin on top of that!

Of course, no one knows what's going to happen over the next year or two, least of all economists! 'The morkets' however have already priced in increases in the deposit rate to at least 2.75% (= main refinance rate of 3.25%) by next summer....and how long we stay up there is anyone's guess!

Personally, I dumped my ECB + 0.95% tracker a few weeks ago in favour of a five year fixed at 2.35%. Considered a ten year fixed at 2.8% (11 years left on mortgage) but went with the shorter term in the end - may pay off, may not! (If you're an Ulster Bank tracker customer, these rates are still available....but not for long I'd imagine so time to make a call).

walterking

I couldn't have replied more comprehensively myself,😁 - ECB is on record with their "neutral to inflation" target and inflation target of 2%

What people forget is that 0% was an emergency measure that went on far longer than anyone expected.

Unless there's a catastrophe, 0% will not be seen again.

Cape Clear

https://www.boards.ie/discussion/comment/119817404#Comment_119817404

Thanks for the informed reply much different to a previous posters simplistic view of things.

Chris_5339762

https://www.boards.ie/discussion/comment/119815494#Comment_119815494

+1 on that as well. Take the 10 year fixed at 3.15%.

Any savings you have at the end of that 10 years, dump into the mortgage too.

DeadSkin

https://www.boards.ie/discussion/comment/119817404#Comment_119817404

I'm in a similar position, dropped the tracker and went with the 10 year fixed, will have 4 years left on the mortgage at the end of it.

Stupid question time, what happens at the end of the 10 years fixed rate, if you're lucky to be in a position to possibly pay off the mortgage do they just offer the latest interest rates at that time?

StonedRaider

https://www.boards.ie/discussion/comment/119822632#Comment_119822632

You'll be offered the latest rate at the time once your fixed comes to an end.

What I did at the end of my fixed with EBS was go variable for a month, pay off a chunk and fix again. In my case 7yrs @1.95% with the option of a 10% overpayment per year. Which I fully intend to do. We aim for a 17yr mortgage to be fully paid off in under 10yrs just because returns on investments have really slowed down

barry181091

Can someone answer this about fixed rate mortgages and new houses. There are new houses going up around m and now is the time to reserve and sign contracts. The thing is the houses will not be available until August at the earliest. Does that mean that you are at the mercy of the banks fixed rate at the time of draw down? Is there a way to lock in the rate now?

stdidit

https://www.boards.ie/discussion/comment/119826094#Comment_119826094

You can't lock it in. It's the rate available when you drawdown.