Hello all
I recently got an option to refinance my mortgage. Here are the details:
I currently have a mortgage at 6M Euribor + 2.4%, 56 k€ left to go. With Euribor being negative, my interest rate for the next six months is 2.194%, I have just under 15 years on it left. A different bank is offering a fixed rate mortgage at 2.1% for 8 years, with a few extra goodies thrown in (no approval fee and so on). My income has grown since I've taken the mortgage, and I can afford the higher payments. The total costs of refinancing (notary costs and an additional insurance I would have to buy, plus some other fees) amount to about 800 €.
The new bank is also substantially more expensive than my existing bank, I'd lose hundreds of € in banking fees over the next several years for services that I have absolutely no intention of using (unlimited free cash withdrawals from ATMs etc).
I can make one additional payment (no limit to size) per year free of charge to my existing mortgage, with the new mortgage the limit is 10 k€ per year free of charge, which is certainly good enough and I don't need any more than that. I expect to be able to pay an additional 10 k€ per year in my existing mortgage in each of the next two years, after which I'll probably slow down significantly. The fixed rate is really fixed, and won't budge even if interest rates go through the roof.
I have contacted my existing bank, and they might offer me some reductions in my existing mortgage - repaying over 10% of total loan value in one gulp this year made me a valuable customer, apparently. I doubt they'll be able to offer a competitive deal though.
Now for the reason for the post - obviously can you help me to decide whether to refinance or not? If interest rates remain as they are, I'd be loosing out on up to 600 €, most of it upfront. But if they rise, I could be better off by a significant amount if they do so soon, but not by much if they stay subdued for more than another two years. I'd be also protected against unforeseen upheavals.
I have until the end of the year to decide, so there is no rush :)
So um ... opinions? Thanks :o
McHrozni
I recently got an option to refinance my mortgage. Here are the details:
I currently have a mortgage at 6M Euribor + 2.4%, 56 k€ left to go. With Euribor being negative, my interest rate for the next six months is 2.194%, I have just under 15 years on it left. A different bank is offering a fixed rate mortgage at 2.1% for 8 years, with a few extra goodies thrown in (no approval fee and so on). My income has grown since I've taken the mortgage, and I can afford the higher payments. The total costs of refinancing (notary costs and an additional insurance I would have to buy, plus some other fees) amount to about 800 €.
The new bank is also substantially more expensive than my existing bank, I'd lose hundreds of € in banking fees over the next several years for services that I have absolutely no intention of using (unlimited free cash withdrawals from ATMs etc).
I can make one additional payment (no limit to size) per year free of charge to my existing mortgage, with the new mortgage the limit is 10 k€ per year free of charge, which is certainly good enough and I don't need any more than that. I expect to be able to pay an additional 10 k€ per year in my existing mortgage in each of the next two years, after which I'll probably slow down significantly. The fixed rate is really fixed, and won't budge even if interest rates go through the roof.
I have contacted my existing bank, and they might offer me some reductions in my existing mortgage - repaying over 10% of total loan value in one gulp this year made me a valuable customer, apparently. I doubt they'll be able to offer a competitive deal though.
Now for the reason for the post - obviously can you help me to decide whether to refinance or not? If interest rates remain as they are, I'd be loosing out on up to 600 €, most of it upfront. But if they rise, I could be better off by a significant amount if they do so soon, but not by much if they stay subdued for more than another two years. I'd be also protected against unforeseen upheavals.
I have until the end of the year to decide, so there is no rush :)
So um ... opinions? Thanks :o
McHrozni
via International Skeptics Forum http://ift.tt/2dzkCMA
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