Sheila Lynch, Pamela Clancy and Angela Woulfe of Cashin Clancy solicitors. Photo credit Natasha Barton / The Clare Echo
Did you know you could make significant financial savings if you switched mortgage to a lower interest rate or reduced your mortgage term? Cashin Clancy Solicitors advises Clare Echo readers on what you need to consider.
Just like any other bill, you should review your mortgage interest rate every few years to ensure you are getting the best value available. Remember, if you have a fixed rate mortgage, when that fixed term ends, you will automatically switch over to the lender’s standard variable rate, which is usually a higher and more expensive rate.
There is quite often a reluctance among us to switch lenders, generally due to the effort involved at the start of the process. Most clients say that gathering the required paperwork for the Bank/Broker is their biggest hurdle, however the benefit of saving money for many years to come will be worth it!
Before you consider switching, you should speak to your current mortgage advisor and check what better rates they have available. Also, check your current mortgage terms and conditions for early repayment charges/exit fees. Using a mortgage broker can cut the time spent researching the best rates, however, be mindful some brokers only deal with a handful of lenders. Another option is to check comparison websites for the best rates.
It takes on average six to eight weeks to complete a mortgage switch. The first step is to obtain ‘mortgage approval’. You will need to produce documents proving stable income and outgoings and evidence of savings is also important.
Having a good credit history is essential and you can obtain a copy of your Credit Report from for the Central Credit Register, www.centralcreditregister.ie.
You will have to obtain a current market valuation of your property and your lender will provide you with a list of Auctioneers from whom they will accept a valuation. You will also have to review and possibly update your Mortgage Protection Insurance.
You should contact your solicitor at an early stage and they will advise you about what legal documents and information need to be gathered in order to complete the process.
There are legal costs involved, but thankfully most banks will now contribute towards those costs, and some banks even offer cash-back incentives. Ultimately, by switching mortgages, you will save significant money by switching to a lower mortgage interest rate and possibly also shorten the term of your mortgage, which is the ultimate goal!
In some cases, where your property has increased in value in recent years, and, depending on your financial circumstances, you may be able to borrow additional money for home improvements.
So, if you are considering switching lenders, or you may be just applying for your first mortgage, contact us on 065 6840060 or by email to enquiries@cashinclancy.ie and we will gladly guide you through the process.
See also our “Guide to Mortgaging/Re-Mortgage” on our website www.cashinclancy.ie/mortgaging where we have set out in seven easy steps the process in mortgaging or switching your mortgage provider, or call us on 065 6840060 and we will be happy to help.
