So many homeowners in Ireland are missing out on savings that can be made by switching their mortgage provider. The Director of Financial Regulation, Gerry Cross recently confirmed when speaking to the BPFI Mortgage Market Council that there are potential unclaimed savings of around €236 million in a one-year time period. Although there is some growth in the number of households in Ireland changing mortgage providers, this number still is surprisingly low.
There could be many reasons for this, some of which include a lack of important knowledge about the costs of changing mortgage providers and how much can be saved. Perhaps it is actually a misconception regarding mortgage switching costs that homeowners in Ireland are deterred from seeking information.
So, if you’ve been pondering about the cost of changing mortgage providers, look no further! This article will take you through the different costs which you may incur, how much you could save and why you should use an expert mortgage advisor like Campion Insurance to switch your mortgage.
One of the biggest questions you may have regarding switching your mortgage is how much it’s going to cost and also what financial benefits there are in doing so. After all, you would only consider switching your mortgage, if it was going to serve you and your household’s best interest.
If you are motivated to switch your mortgage in order to save money, here are some of the potential financial benefits:
Another question you may have is how the cost of switching mortgages compares with any long-term savings you may achieve. The numbers will speak for themselves and will give you a strong indication whether it’s going to be a good financial decision. Keep reading for more insight into how much you can save vs the cost you may incur.
Important Note: Customers on a Fixed Rate who decide to change lenders before their contract ends may have to pay a breakage penalty. It is helpful to know this penalty amount when looking into switching mortgage providers.
Although there is no one answer, the good news is that many switchers end up saving thousands of Euros. Surprisingly, a monthly saving of €281 could give you a lifetime saving of over €67,000!
| Property Value | €300,000 | €350,000 | €400,000 | €450,000 |
| Current Mortgage Balance | €240,000 | €280,000 | €320,000 | €360,000 |
| Current Interest Rate | 4.50% | 4.50% | 4.50% | 4.50% |
| Current Monthly Repayment | €1,518 | €1,771 | €2,024 | €2,278 |
| New Interest Rate | 3% | 3% | 3% | 3% |
| New Monthly Replacement | €1,331 | €1,533 | €1,775 | €1,997 |
| Monthly Saving | €187 | €218 | €249 | €281 |
| Annual Saving | €2,244 | €2,616 | €2,988 | €3,372 |
| Lifetime Saving | €44,880 | €52,320 | €59,760 | €67,440 |
We have more details on how switching can save you money, including this helpful table in our article How Switching Your Mortgage Can Save You Money.
Although a Broker like Campion Insurance can help with most aspects of switching your mortgage, a solicitor is recommended to take care of the legal paperwork. You can expect to pay the solicitor of your choice somewhere between €1,000- €2,000 plus VAT @ 23%. This is a rough estimate as each firm will differ.
To help you find a solicitor in your area, visit The Law Society website. Remember that you can shop around to find the most cost-effective option.
It is not uncommon for a new lender to cover all or a portion of the legal costs.
Aside from the solicitor’s fees, one of the remaining costs you will incur is valuation fees. Your bank will appoint an estate agent to value your home to ensure you’re on the right mortgage rate.
As you can see, changing your mortgage provider does come with upfront costs. So, is there anything that can be done to cover such costs? The good news is that some Banks will often give cash back, or a contribution towards the legal fees associated with switching service providers in order to motivate prospective customers to make the switch. For example, AIB has an attractive switching offer of €2,000:
“We’ll give you €2,000 when you switch your mortgage to AIB to help cover your costs; we’ll pay it into the current account you use to pay your new mortgage within two months of your mortgage drawdown, even if that current account is with another bank.:
So, you have all of this valuable information about the costs of switching your mortgage provider. Now what? We are glad you asked! Next, we want to tell you just how helpful it is to work with Campion Insurance when changing mortgage providers.
In this section, you will learn the benefits of choosing Campion Insurance to switch your mortgage as well as what you can do next to get the process started.
Benefits of Using Campion Insurance:
We’re taking away the mystery and uncertainty surrounding switching your mortgage by outlining the process, and indeed your next steps if you choose to work with Campion Insurance:
Step One: Contact our Mortgage Advisors to discuss your current mortgage and situation on 0818 297 600
Step Two: Our team gets to work by evaluating and reviewing your current mortgage in order to determine how much you can save by comparing it to other rates.
Once we have determined which option is best for you, we can handle your application from beginning to end and be available to answer questions you might have.
Step Three: We’ll go over the paperwork needed for your application, and once it’s been submitted and approved, you can move forward with switching mortgages.
To complete your switch, you must have mortgage protection and homeowner’s insurance. The new Bank or Lender will also require a valuation of your house.
Do you still have a question about how to switch your mortgage and the cost incurred? Give our team a call today. At Campion, we work for our customers and their best interest.
| Warning: The cost of your monthly repayments may increase. |
| Warning: If you do not keep up your repayments you may lose home. |
| Warning: You may have to pay charges if you pay off a fixed-rate loan early. |
| Warning: If you do not meet the repayments on your loan, your account will go into arrears. This may affect your credit rating, which may limit your ability to access credit, a hire-purchase agreement, a consumer-hire agreement or a BNPL agreement in the future. |
Useful Links
Campion Insurance: Switch Your Mortgage & Save Money
Citizen’s Information: Switching Your Mortgage
