Are you burning a €4k hole in your pocket by not switching?

HOMEOWNERS can be needlessly paying an average of €4,097 in extra mortgage repayments per year by not switching lenders, new research has found.

This is a rise of €657 over the past 12 months, with a monthly saving of up to €135 for every €100,000 owed on a 25year mortgage for those who switch.

Homeowners who switch to raise funds to improve the energy rating of their house can now end up with similar or lower monthly repayments thanks to the entry of new green rates onto the market, the Doddl.ie mortgage switching index also found.

The volume of mortgage switching has increased by more than 35% year-onyear as more householders take advantage of the recent downward shift in mortgage interest rates.

More switchers are now seeking independent market-based advice as four mortgage lenders, including those offering the lowest market rate and long-term fixed rates, only offer their products through brokers.

Martina Hennessy, managing director of Doddl.ie, said: ‘This represents a positive shift in consumer behaviour as mortgage applicants seek out marketbased advice and lower rates.

‘All banks claim to be customercentric. However, it is the new entrants and non-bank lenders that are leading the way with regards to lowest market rates and new innovative products such as whole-of-term mortgage rates.’

Figures show the number of people topping up their existing mortgage has also increased dramatically – with a 43% rise in top-up mortgage drawdowns year-on-year.

‘We are seeing a significant increase in mortgage holders looking to release equity in their home to carry out home improvements and fund extensions,’ Ms Hennessy said. ‘After spending the past year largely at home, people are finding that in many cases, their environment is not suitable for their needs.’

She added that many are doing so to create better work spaces at home.