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How To Switch Mortgage In Ireland: Our Guide To Choosing Wisely & Saving Money
When and why should homeowners switch mortgage in Ireland? This is a question we get asked a lot by clients, many of whom are looking to save money following a rise in inflation in recent years.
For many Irish households living through this cost-of-living crisis, the mortgage remains the largest regular expense by far. Cutting down this hefty outgoing through switching can be a shrewd way to claw back some funds for personal savings.
In this guide, we walk you through the process of switching mortgage providers in Ireland, so that you can compare your options, reduce payments and save money long term.
Should you switch mortgage in Ireland?
As already touched on, there can be significant financial advantages to switching mortgage in Ireland.
According to the Central Bank’s research, over 60% of switched mortgages are upwards of €10,000 cheaper over the remaining term of the loan.
Such substantial savings are largely down to reducing the overall interest on the loan – something many homeowners are unaware of. In fact, with an estimated 100,000 mortgage holders forking out way over the odds on their monthly repayments, many lenders have been accused of “banking on people’s apathy” to continue charging astronomical interest rates.
Aside from reducing your existing interest rate, switching mortgage can also open doors to enticing cashback offers and more flexible terms.
Furthermore, if your home has a BER of between B3 and A1, you could examine the possibility of switching to a green mortgage, which may have a markedly lower interest rate than your current loan.
Are you eligible to switch?
If the above money-saving statistics have piqued your interest, you will need to confirm your eligibility to switch mortgage provider before going any further.
Generally speaking, any mortgage holder can switch during their contract, provided they are up to date with their payments. However, it’s important to weigh up how cost-effective a switch would be by considering your own personal situation and where you are in the context of your loan term.
Here are the factors to keep in mind:
- If you are currently on a fixed rate, you may be charged an early breakage fee if you decide to switch.
- If your loan-to-value (LTV) remains high, or your mortgage is near completion, or your property is in negative equity, switching might not be feasible.
- The legal fees involved with a switch can be costly. In Dublin, for example, these fees generally range between €1,200 and €1,500 before VAT is added on.
- An up-to-date professional valuation of your property will be required before switching, which can cost upwards of €250. This is so that prospective new lenders can examine your LTV before proceeding with an offer.
While switching yields clear rewards, it’s crucial to consider these against the potential drawbacks and hidden costs involved.
Switching mortgage with your existing lender
When people hear of a mortgage switch, they often automatically assume it involves a jump to a different lender. However, it is possible to shop around with your existing mortgage provider by choosing a different product with a lower interest rate.
This process has been made easier through stipulations set out by the Central Bank, which instruct lenders to inform you about cheaper options 60 days before your fixed rate expires.
While making a change with your existing lender will undoubtedly save you time, it is still highly advisable to shop around for further potential savings before deciding to stay put.
Switch mortgage in Ireland with this step-by-step guide
If you’ve decided to take the leap and switch mortgage, there are several steps you must follow to facilitate a smooth and stress-free process:
1. Compile necessary information
Collect all relevant details on your current rate, remaining term, balance and any exit penalties you may face.
2. Shop around for competitive interest rates and incentives
Compare rates, cashback offers, loan flexibility, green incentives and lender reputation, placing focus on real long-term savings, rather than promotional rates.
3. Calculate your potential savings
Subtract expected costs (early breakage fee, legal fees, valuation fee) from your potential savings. If the net benefit is clear, switching makes sense.
4. Apply for your new mortgage
Switching often requires a full mortgage application, particularly if you are opting to go with a new lender. This process, along with the valuation and legal transfer, typically takes six weeks to two months to complete.
5. Update your insurance
Once your new mortgage has been approved and you have coordinated with your solicitor and lender to complete the transfer, it’s vital to ensure your mortgage protection and home insurance are updated.
How expert help makes it easier to switch mortgage in Ireland
Switching can feel complex, but with the help of our expert mortgage advisors and our switcher mortgage service at Symmetry Financial, you don’t have to go it alone.
We assist by:
- Evaluating your current mortgage to calculate potential savings.
- Comparing the Irish mortgage market for the best fit.
- Liaising with lenders, valuers and solicitors on your behalf.
- Offering strategic guidance to match your mortgage with your wider financial goals.
We make the switching process smoother, faster and more rewarding.
Switch mortgage in Ireland with the help of Symmetry Financial
If you’re ready to find out how much you could save by switching mortgage, contact us today for a friendly, expert consultation.
If you’d like a free, no-obligation consultation for your mortgage, pension or financial needs, get in touch here, call us on 01 6831673 or email us directly on info@symmetryfinancial.ie.
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