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Switching Mortgage Ireland 2023? How to Guarantee Great Savings

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Switching mortgage Ireland 2023. As someone who used to be responsible for mortgage products at one of Ireland’s largest mortgage lenders PTSB, the low numbers of mortgage switchers in Ireland always surprised me. 

switching mortgage  ireland 2023

Anybody who took out a mortgage after 2008 and is no longer on an introductory rate is likely to save around €25,000 by switching mortgage. That’s over two hundred thousand Irish households. Over half of all mortgage holders, 450,000 households, will save at least €5,000 by switching mortgage in Ireland 2023.

These are some of the largest savings in Europe, yet Irish mortgage holders switch mortgage at half the rate seen in other European countries.

The key reason for Ireland’s low mortgage switching rate is that most people don’t realise how much they can save or how easy it is to switch mortgage these days.

Read on to find out how much you would save by switching mortgage Ireland 2023, plus everything you need to know on how to switch mortgage and get saving.  

Would I Save by Switching Mortgage Ireland 2023?

Almost certainly, this is because your interest rate drives how much you save and there is a huge difference between existing and new business interest rates. 

If you are one of the 66%+ people who took out a mortgage after 2008 and aren’t on a introductory fixed rate you should definitely look into switching mortgage. This is because you’re almost certainly on what lenders call a standard variable rate or tracker rate. If you have a tracker mortgage, mortgage switching is now an option for the first time in a long time. Tracker mortgages were sold between 2001 to 2008 and ‘track’ the ECB base rate.

Size of mortgage market Ireland 2023
Mortgage Market Ireland Private Household Buy To Let Total
Outstanding Mortgages (M) €79,421 €3,685 €83,106
Mortgage Accounts 712,347 70,057 782,404
Mortgage Holders 569,899 56,046 625,945
Based on Central Bank Credit for House Purchase advanced data and Mortgage Arrears data & moneysherpa analysis 20/10/23

These interest rates remain some of the highest in Europe, at an average of 4.2% [1]. Switching mortgage to a new business rate with a new mortgage lender will halve your interest rate to around 2%. 

Current mortgage rate in Ireland 2023
Housing Tracker (PDH) Variable Rate Fixed 1 Yrs+
Private Household +1.15% 4.02% 2.85%
Buy To Let +1.08% 4.39% 3.82%
Central Bank retail Interest Rate data updated 20/10/2023

Irish lenders have kept old customer rates high to pay for the fall out of the financial crash and the cost of funding the tracker mortgages. But, due to international banks entering the market they had to lower new customer rates.

This difference, between the old customer and new customer rates, is why switching mortgage in Ireland in 2023 delivers such a big saving. 

So will you save by mortgage switching? To keep things simple we have grouped mortgage holders into three big groups.

Introductory rate (2%), the 100,00 of people with fixed rate (new in last 0-2 years) – Switch Mortgage Soon

Tracker rate (2%), the 100,000 people who bought between 2001-2008 – Switch Mortgage Now

Standard rate (4%), the 80,000 of people who are not on an introductory or tracker rate – Switch Mortgage Now

You can check for certain which interest rate you are on, by digging out your annual mortgage statement or by putting your monthly repayments into our handy calculator below. 

How Much Would I save by Switching Mortgage Ireland 2023?

If you are in the majority of Irish mortgage holders who would save big by switching mortgage,  working out exactly how much you would save isn’t complicated. 

You just need to know 4 things. 

1. current monthly repayment – How much does your mortgage cost every month?

2. home value – How much is your home worth today?

3. loan needed – How much do you still have left to pay on your current mortgage?

4. term needed – How many years do you have left to pay on your current mortgage? 

Our handy mortgage repayment calculator takes these four things, automatically calculates the rates available at your LTV and estimates out how much you would save if you switch mortgage to the best rate in the market.

The loan and term outstanding is easy to get as it is sent to you each year by your lender and doesn’t change that much each year. For people switching mortgage last year the loan was €170,000 and the term 15 years on average. [2]

The more your home value rises the lower the rate you can get when you switch mortgage. This is what lenders call the Loan to Value ratio or LTV. If you’re not sure about your home value it’s easy to estimate. 

If you bought before the crash in 2008 your house is probably now worth about what you originally paid for it as the market has pretty much bounced back since then. 

If you bought after 2008 it should be worth roughly what you bought at, plus give or take an additional 4% for every year since you bought. So if you bought ten years ago you can add on 40%, nice!

Rank Mortgage Product Rate Value Repayment Security Ease of Approval Approval Speed Overall Rating
#1. Avant Money Mortgage 10-30 Yr Fixed 4.25 5.0 4.0 5.0 4.58
#2. Avant Money Mortgage 7 Yr Fixed 4.25 3.5 4.0 5.0 4.13
#3. Haven Mortgage 10 Yr Fixed 3.5 4.0 3.5 5.0 3.95
#4. Avant Money Mortgage 5 Yr Fixed 4.5 2.5 4.0 5.0 3.90
#5. Haven Mortgage 7 Yr Fixed 4.0 3.5 3.5 3.0 3.55

Rating Weighting: Rate 30%, Security 30%, Approval 20%, Speed 20%, updated 26/09/2023

How Much Hassle and Cost is it Switching Mortgage Ireland 2023?

Fortunately switching mortgage Ireland isn’t like applying for a mortgage the first time around. You can now do it totally online and for free. 

Lenders, who are keen for new business, may pay to get your home valued, your legals and for you to use a broker or an online switching platform like moneysherpa’s.  

Plus, if you go for an online switching platform or a broker, they will handle all the paperwork for you.  

Sometimes if your income or the value of your property has reduced or other commitments have increased lenders won’t allow you to switch your mortgage. This is rare though as in most cases your home value will have increased and your loan value decreased as you made your monthly payments. 

Don’t worry though, our online mortgage application tool checks this out automatically, so we can help you get in better financial shape or find a more suitable lender if needed.    

How do I Switch Mortgage Ireland 2023?

You’re probably over the hump already if you have worked out your savings and found the best rates using our repayment calculator. At this point you’re only 4 steps away from cashing in on your mortgage switching savings.

couple 2

1. Apply

This takes less than 5 minutes using our online application tool.

2. Assess

Our moneysherpa mortgage team will then run the numbers. Including getting your home valued by a licensed local estate agent to get you the best rate for your LTV. 

3. Offer

Then if all looks good, we will email you a loan offer.

4. Draw down

If you are happy with your new deal, we pay off the mortgage you have with your current provider and get your new mortgage up and running.

In a Nutshell – Switching Mortgage Ireland 2023

1 in 5 Irish mortgage holders will save around €25,000 and over half of all Irish mortgage holders will save over €5,000 by switching mortgage Ireland.

With changes in regulation and new online platforms available it’s now very straightforward to mortgage switch and save. 

Switching is free with both brokers and online platforms able to handle the paperwork for you. If you want to book a free advice call with on of moneysherpa’s advisors to see who much you would save you can do that here.

What next? – Simple Mortgage Switching Ireland 2023 Steps

To check out how much you would save or what rates are the best for you, use our handy repayment calculator here.

To help you compare and choose the best rate for you the best mortgage switcher deals on the market are here.

How to switch mortgage provider?

The simplest way to switch mortgage is to speak to a mortgage broker. Brokers fees are usually paid for by the lenders and many have exclusive access to lenders with the best rates. Avant Money, ICS and Finance Ireland have the lowest rates and are only available via brokers. 

What is mortgage switching?

Mortgage switching is taking out a new mortgage with a new lender, usually because the new lenders interest rate is lower and using that mortgage to pay off the old mortgage. The average saving on switching in Ireland is over €20,000, leading to increased numbers of switchers.

How much does it cost to switch mortgage providers?

It costs around €1,400 to switch mortgage if you do it right. 
1) A solicitor gathers the right paperwork and checks the terms of the new loan. The fees usually come in between €1,200 to €1,600 including VAT. 
2) An estate agent values your home. So the bank can put you on the right rate and usually comes in at €150 excluding VAT.

How much are the legal fees to switch mortgage?

Legal fees to switch mortgage usually come in from €1,000 to €1,500. The solicitor has to request the deeds from your old bank and then handles the paperwork with your new bank. They will also make sure you understand the terms of the new loan before you sign the new loan agreement. 

Do I need a solicitor to change mortgage?

Yes, under the law you need a solicitor to switch mortgage. The solicitor will transfer the deeds from your old lender to your new lender and to advise you on the terms of the new loan offer. Having a solicitor also gives you and your bank confidence in the paperwork. A mortgage broker will handle the solicitor for you.

How much to switch mortgage?

Average costs to switch mortgage are under €1,400 inc VAT to cover a solicitor and estate agent. If you shop around you should be able to find a mortgage broker who is fully paid for by the lender and will manage the solicitor and estate agent on your behalf. 

How long does it take to switch mortgage lenders?

It usually takes 6-12 weeks to switch mortgage lenders. Switching mortgage is pretty straightforward compared to buying a property first time round. 
First you need to pass your new lender’s credit check, this is usually pretty quick, as you already have evidence you are paying a mortgage with your old lender. 
Then you need to get a solicitor involved to handle the contract paperwork. Finally, a local estate agent selected by the new lender values the property. 

What is involved to switch mortgage provider?

There are 4 steps to switch mortgage provider.
1. Find the best lender using an online calculator
2. For credit approval you will need to prove who you say you are and provide evidence of your ability to repay the loan. To confirm you are on the right rate the new lender will also ask you to get your home professionally valued. 
3. Now comes the legal bit, which is much simpler than when you buy. Your solicitor gets the paperwork sorted, checks you understand it and you sign. 
4. When all the boxes have been ticked your new lender will ask you to fill in a new direct debit to collect your repayments. 

How to switch mortgage provider? 

5 simple steps to switching your mortgage
Step 1 – Calculate your mortgage savings online
Step 2 – Find a mortgage broker fully paid for by the lenders 
Step 3 – Gather your paperwork, bank statements and salary certificates
Step 4 – Use your broker to manage the solicitor and estate agent
Step 5 – Enjoy your new mortgage savings every month

How easy is it to switch mortgage?

Using a mortgage broker can make the switch mortgage process very straightforward, they will handle all the paperwork for you. If you shop around you should be able to find a broker that is fully paid for by the lenders. Solicitors fees and Estate agent fees are also covered by some lenders. It takes 6-12 weeks to complete the switch from start to finish.

How do I switch mortgage lenders?

To switch mortgage or to remortgage you simply take out a new mortgage with a new lender and use that to pay off your old mortgage provider. Typically this is to avail of a lower mortgage rate with the new lender on the same mortgage amount or to increase the mortgage known as ‘topping up’ to release equity from your home. It makes sense to consult with a mortgage broker before switching.

How often can you switch your mortgage provider?

There’s no limit on how often you can switch your mortgage provider, even if you have received a cashback offer. If you are still in your fixed rate period you need to watch out for ‘breakage fees’. Under EU law the fee is capped in line with the cost to the lenders of providing the rate. This depends on the difference between the interest rate when you fixed and the interest when you switch. As a result, often there are no fees at all, but the only way to be sure is ask your bank what your fee would be.

How many times can you switch mortgage?

Under EU law there is no limit on how many times you can switch your mortgage. This also means that you can avail of multiple cashback offers. The best rates however are fixed rate mortgages which can have penalties if you switch within the fixed period. 

When can you switch mortgage?

You can switch mortgage for free if you are outside your fixed rate period, usually 3 or 5 years after you took out the loan. Even if you are in the fixed rate period you may be able to switch without penalty due to EU law. Ask your lender to calculate what ‘break out’ fee would apply in your particular case.  

Can you switch from a fixed rate mortgage?

You most certainly can switch from a fixed rate mortgage. A lot of people think this always incurs a fee, but due to an EU law banks can now only cover their costs with these fees. This means the fee the bank is allowed to charge depends on the difference between the rate when you fixed and the rate when you switch. You should ask your bank what fee would apply to you, more often than not it turns out there are no fees at all.

Can you switch mortgage if in negative equity?

If your loan is larger than the value of your property, switching can be tricky as the bank ‘backs’ the mortgage with the value of your house. It often makes sense to get an up to date valuation and then talk to an experienced mortgage broker about your options if you think you might be in negative equity.

How much will I save if I switch mortgage?

If you bought after 2008 you may be one of the 175,000 mortgage holders on rates of 4.2% APRC, meaning big savings if you switch mortgage. The average saving for these customers is around €20,000 over the duration of the mortgage. Even if you aren’t on a 4.2% rate, you will probably save thousands by switching.

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