1. How much you could save:

You have a remaining balance on your mortgage of €250,000 and your house has a market value of €350,000. Your mortgage term remaining is 25 years. Your current monthly repayment is €1,350 on a variable interest rate. Using the mortgage comparison tool, you could potentially save €170 each month and approximately €51,286 over the lifetime of the mortgage if you switched to a lower rate. Remember this does not include any additional costs (such as legal fees etc).

This is an example only (August 2018).

2. How to work out your LTV:

Jenny took out a mortgage four years ago to buy a property in Dublin. The house cost €250,000 and Jenny borrowed €210,000 from her bank after choosing a variable rate mortgage, with an interest rate of 4.5% over 35 years. Jenny’s LTV was over 80% at the time and her monthly repayments were approximately €994 per month.

Four years on, Jenny gets a valuation of her house and it has risen in value to €400,000, with the bank confirming that her mortgage outstanding is €198,925. She is now in an LTV band of up to 50% and can avail of a lower variable rate of 2.75% with her provider, meaning her revised monthly repayments are now €795.

Jenny has saved herself €198.75 per month simply by taking the time to review her LTV. Over the lifetime of the mortgage, this will amount to approximately €73,993. When we include the €150 valuation cost, Jenny has saved herself €73,843.

This example is for illustrative purposes only (August 2018).

3. How does cashback work? 

John has a mortgage outstanding of €300,000 on his home in Dublin which is currently valued at €360,000. John wants to switch his mortgage and decides to go with a variable-rate mortgage. John’s current loan-to-value ratio is 83% and he has 25 years remaining on his mortgage. 

John is doing research and finds a bank that is offering cashback to the value of 2% of the amount borrowed. John is delighted that he will get €6,000 cash back to move to Lender A. But there is another lender in the market with a lower APRC and no special offer – the table below shows the true cost of both options. 

This will prove quite a costly decision for John. The temptation to take the 2% cashback offer will cost him €43,688 over the term of the mortgage. His mortgage repayments with Lender A are also €165 more expensive a month than they would be with lender B.