How Irish homeowners could save €3,600 a year by making mortgage switch – all your questions answered about making the move
According to MyMortgages.ie research, the ‘average’ borrower could save between €40,000 and €100,000 over the lifetime of their mortgage by moving to another lender
By Fiona Ellis 30 November 2017
According to the company’s research, the “average” borrower could save between €40,000 and €100,000 over the lifetime of their mortgage by moving to another lender.
Joey Sheahan, Head of Credit with MyMortgages.ie said: “A mortgage is most people’s biggest monthly expenditure and yet it’s something that people don’t pay enough attention to when it comes to getting the best value on the market.
“Many people assume that once they’ve taken out a mortgage with a lender for 20/25/30 years, then that’s the end of the decision making process.
“But mortgages are just like any other financial product – they should be reviewed every 3 years to ensure you are not paying over the odds.
“There are lots of homeowners needlessly paying more than 3.6% in interest but a large portion of these people can easily switch lender once they have 10% equity in their property.
“There are less and less people in negative equity due to the unprecedented recovery in property values over the past few years.”
Joey Sheahan, Head of Credit with MyMortgages.ie answers some common questions about switching mortgages.
1. If there’s so much money to be saved, what’s stopping people switching?
A simple lack of awareness and a belief that people are somehow “tied” to their current lender. The paperwork required is generally a lot less than initial mortgage approval depending on the bank.
2. Can anyone switch?
If you are a fixed or variable rate mortgage customer and have 10% equity in your property then you are definitely of interest to other mortgage lenders, which means you could potentially save thousands of Euro over the remaining term of your mortgage by switching.
Due to the current low cost of funds available for banks, in many cases there is no early breakage fee for exiting a fixed rate. You just have to call your bank to check this.
3. What do I do first?
– To begin the process you should contact your existing Lender and confirm your rate of interest, balance outstanding and term remaining on the mortgage.
– Ask them if the interest rate you are currently on is the best available to you and what fixed rate options are available to you as an existing customer.
– You should then contact a qualified and professional mortgage broker and ask them to compare your existing mortgage terms to what is available to you in the market.
The more equity you have in your home the better the new terms likely to be available to you but you can switch even if your loan is 90% of your value.
It is imperative at this point that you weigh up all your options & take expert advice when deciding whether switching is the best course of action for you.
4. What will I need?
If it is and you decide to go ahead then you will need to go through the application process and submit your documentation. This varies from lender. Some only require:
– Application form
– 1 x Recent payslip,
– Three recent monthly current account statements
– Most recent credit card & mortgage statement.
Like any big financial decision, switching your mortgage is not a step to be taken lightly – but if you’ve done your homework and this emerges as the best option for you, then it’s definitely worth pursuing as the savings could be huge.
Source: The Irish Sun 30 Nov 2017
If you are interested in getting a mortgage and would like to speak to us at MyMortgages.ie please don’t hesitate to contact us at [email protected] in Cork +353 21 4277037 or 353 86 8060601
MyMortgages Ltd t/a MyMortgages.ie is regulated by the Central Bank of Ireland.