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Homeowners could save €4,000 by switching mortgage providers

November 08, 2021

Mortgage advice company says switching in Irish market has hit record levels

Full article: noted Avant Money and ICS Mortgages were currently offering fixed rates of 1.95% if applicants have a loan-to-value of less than 60%. Photograph: iStock

Homeowners could save more than €4,000 a year by switching to a different mortgage provider, according to mortgage advice company

The group said mortgage switching in Ireland had hit record levels as people take advantage of stronger loan-to-value ratios and record low interest rates., which collates data on switching activity in the Irish mortgage market, said the number of approvals for mortgage switchers increased by more than 36 per cent annually to the end of September, representing the highest annualised level of switcher approvals on record.

House prices are rising at an average of €3,500 per month – over 12 per cent annually – giving homeowners access to a lower rate tied to their improving loan-to-value ratios. noted Avant Money and ICS Mortgages were currently offering fixed rates of 1.95 per cent if applicants have a loan-to-value of less than 60 per cent.

Homeowners can be needlessly paying an average €4,258 in extra mortgage repayments per year by not switching lenders, it said.

This is an increase of €735 over the past 12 months, and means a monthly saving of up to €135 for every €100,000 owed on a 25-year mortgage for those who switch.

The calculation was based on the average mortgage drawn down for new lending in both the first-time buyer and second-hand mover markets in the third quarter of 2021, currently €263,984.

Greater awareness

“Consumers are becoming more aware of the recent downward shift in mortgage interest rates, and are looking to capitalise on the strong loan to values in the current market caused by the 13-year highs in house prices,,” said managing director Martina Hennessy.

“We are seeing people rolling off fixed rates on to variable rates of over 4 per cent, who can now avail of these vastly lower rates,” she said.

“Over the last 12 months there has been a lot of downward movement in rates and mortgage holders should review rates and options on the market and switch if it makes sense to do so.”

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