6 Steps to switching your mortgage

Step 1: Compare mortgage providers
Review all mortgages to work out which is best for you. You might want more flexibility or overpayment options to reduce the length of your mortgage. Consider the Credit Union as well as banks.  You could also hire a mortgage broker to compare mortgages and take care of your switchover for €500 or less. You may wish to seek financial advice. It may not be beneficial to switch if you are on a tracker mortgage.

COMPARE MORTGAGES

This will bring you to a comparison tool on the Competition and Consumer Protection Commission website.

Step 2: Talk to your own bank
Tell your old bank that you’re thinking of moving your mortgage. Then see what they offer you to tempt you to stay before you make up your mind to switch.

Step 3: Get the necessary approval
Once you know which bank has the best mortgage for you, talk to their switcher team or mortgage advisor to get the necessary approval. Be ready to complete a mortgage application by having the information you need to hand.

Step 4: Know which costs are covered
Some banks may ask you to pay for a valuation of your home. Or request that you get a solicitor on board to take care of any legal documents. Make sure you ask about legal fees as many banks cover these costs to encourage you to switch.

Step 5: Move relevant policies
Will your existing  mortgage protection and home insurance policies cover the mortgage? You should notify the insurance company you have the policies with that you are changing mortgage provider so they can note the new lender on the policy.

Step 6: Come home to a new mortgage
Amend your direct debit arrangements to your new bank and set a date for repayments to start.

Useful tips

Know your figures
Before you switch you will need to redeem your current mortgage. Get in touch with your bank to find how much money is owed on your mortgage and how long you have left to pay it.

Have your documents ready
Proof of identity such as a valid passport or driving licence; proof of address such as a current household bill in your name; proof of income such as your latest P60 and at least 3 recent payslips; and proof that you manage money well such as current account and loan statements for the past 12 months.

Be prepared to share
A new lender will treat your switching application like a new mortgage application because they’ve never had a banking relationship with you.  So a new mortgage lender could ask you about the following:

  • Your income and whether you plan on renting out rooms for rental income;
  • Your age and the number of years remaining until you reach retirement;
  • Any outstanding loans or a credit rating that might affect mortgage payments;
  • Other financial commitments you might have like childcare costs;
  • A guarantor or person willing to repay the mortgage if you are unable;
  • Whether you are borrowing on your own or with a partner;
  • Whether you have mortgage protection and home insurance in place; and
  • Your savings accounts and ability to put money aside for the unexpected.

Act on a mortgage offer
Your new lender will give you mortgage approval in principle for a set amount based on the details you gave in your mortgage application. This is a mortgage offer that you should seriously consider before it expires on a certain date. Once the time is up, you’ll need to apply again.

Cancel your old direct debit
Be sure to cancel your old direct debit with your old mortgage lender in writing once the final month’s payment is made