BOI Mortgage interest rate for KBC customer.

brazilaa

I got my mortgage with KBC back in 2019 and started off with a fixed rate for 5 years at 2.80%.

I just received a letter from BOI stating my fixed term is up in March 2024 and they provided me with a list of available rates to choose from. The letter states that because I had a discounted rate of 0.2% with KBC, I will continue to enjoy that discounted rate and it is incorporated into each of the options below.

.>80% LTV Variable @ 3.55%

1 Year Fixed @3.95%

2 Year Fixed @3.95%

3 Year Fixed @4.05%

5 Year Fixed @4.05%

10 Year Fixed @4.55%

The variable rate at 3.55% seems low for BOI even with a discount of 0.2%. When looking at their rates online it looks like their variable rate is currently 4.75%.

I feel like if I choose the variable rate at 3.55%, it wont be long until they change my rate to the higher variable rate of 4.75% that I see online.

Looking for advice here, what do you lot think?

Thanks

cython

As part of the terms of acquiring the KBC business, BOI are also obliged to offer a one time variable rate to ex-KBC customers rolling off fixed rates for the first time, and this rate is linked to what KBC would have offered based on their SVRs at the time of the acquisition.

The only way BOI can raise this variable rate is by raising their "main" one by the same amount, as they are required to maintain the distinction between this rate and their own. They've done this one since rates started to climb, as far as I know.

If you do not avail of/if you surrender this rate in March, you will not have it as an option again (you'll be a full fledged BOI customer then), so you do need to give it sufficient consideration. Given that it's better than the other options I would find it hard to look past myself, especially with the flexibility variable affords for overpayment.

JVince

I'd jump at that variable rate offer.

Remember you can move to a fixed rate at any point and with ECB next moves downwards, fixed rates will move down too.

There is no downside to taking the variable rate they are offering

L1011

BOI are being exceptionally compliant to the CCPC ruling on taking on KBC loans and are offering market beating rates on expiry/rollover of deals.

Jump at - as said above, there is no downside; once on a variable you can move at any time anywhere without exit fees.