Mortgage switching can be a daunting prospect for many homeowners, with only 28% of mortgage customers considering making a switch in the past year. The research from Banking and Payments Federation Ireland (BPFI) highlights that a significant number of homeowners are not aware of important information when it comes to comparing rates.
One of the key reasons why more people may not have considered mortgage switching is the uncertainty about the steps involved, as mentioned in a recent ESRI report. There is also uncertainty about the costs and benefits, as well as the fear of making a mistake. To address these concerns, BPFI has launched a nationwide information and awareness campaign and a new website, InYourInterest.ie, to provide customers with the necessary information to start the switching process.
The campaign aims to educate mortgage customers on what to consider while shopping around and the steps involved in becoming ‘switcher ready.’ Additionally, BPFI mortgage lending members have introduced a new standardised salary certificate for mortgage applicants, streamlining the application process.
Brian Hayes, the chief executive of BPFI, emphasizes the potential savings that can result from switching mortgages. Analysis by the Central Bank of Ireland shows that customers who switched between 2019 and 2022 saved an average of €2,000 per year. Factors such as a decrease in the loan-to-value (LTV) ratio of the property or an improved Building Energy Rating (BER) can also impact the savings that can be made through switching.
It is important for homeowners to be informed about their mortgage options and consider switching if it could lead to significant savings. By taking the time to explore different rates and products, homeowners can make informed decisions about their mortgage and potentially save money in the long run. The key is to be proactive, seek out information, and be prepared to take the necessary steps towards switching to a better mortgage product.