mortgage news article - doddl

Mortgage switching savings for each Irish county revealed

June 01, 2020

The spread between the highest and lowest interest rates available on the market  has now grown to 2.2%.

This gap between repayments on the lowest mortgage rate at 2.3% and the highest at 4.5% is now 27%, meaning that some homeowners are needlessly paying twice as much interest on their mortgage at a time when switching has become easier than ever. Rates based on 90% mortgage finance. Rates at 80% loan to value are even lower at 2.2%.

This map highlights the differential between the lowest and highest non-discounted interest rates on the market – and the potential savings available.

The Index is based on a new lending 90% mortgage drawn down on the average three-bed semi-detached house value* in each county.

“Mortgage holders need to optimise their rate and terms, especially at the moment, and the impact of lower interest rates is hugely significant,” said Managing Director Martina Hennessy.

“Sticking with a lender who is charging you a higher rate than you can achieve on market does not make sense.

“These average savings per annum are interest savings and interest adds no value to your mortgage.

“Current bank switching packages have also removed the previous deterrent of cost in switching mortgages.

“In most cases financial institutions will provide a lump sum amount, once the new mortgage is drawn down, which generally covers any transaction fees involved in switching.

“These switcher packages range from €1,650 up to 3% of the mortgage amount outstanding back in cash.

“With so many rate and cashback offers on the market it is important to get impartial advice to help you understand all available options available to you with regard to mortgage switching rather than directly responding to a marketing message from an individual bank.”

The rate of mortgage switching has more than trebled in the past four years, our data shows.

Mortgage switching transactions represented 14% of home loan lending at year end 2019, this percentage up from 5% in Q4 2015 when the market for mortgage switching started to open up again.

*Average house price data provided by Real Estate Alliance (REA) quarterly house price index.

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