A.E.M.A.

Mortgage applicants should beware of "lucrative" offers

Would-be mortgage applicants should take a cautionary approach when it comes to enticing “offers” from lenders, according to experts. Those looking to purchase their first home should beware of the “too good to be true” offers from banks – because many of them are just that, they said.

Banks have announced a variety of initiatives recently to entice mortgage customers, including Bank of Ireland offering 2 per cent of the value of the mortgage and Ulster Bank offering €1,500 in cash. KBC is offering 6 months free home insurance, while Permanent TSB has a €1,000 cash up front offer.

But the Association of Expert Mortgage Advisers warned that many of the offers that are heavily marketed are often only open to a certain group of people who fit specific criteria.

“Borrowers must remember that while lenders want your business they also want profit and this is what drives any moves they make in the market,” said Murray.

“Some deals will have merit and will be suitable for people in particular circumstances, for example if a client wants the security of a long-term fixed rate then they might benefit from.

However, other apparently ‘lucrative’ offers might end up costing you in the long term e.g. cost of switching to avail of a deal, or the rate you will roll off to after the initial introductory offer has expired.,” he said.

“You can’t just look at the offer at face value – you must see what’s behind it and start asking questions – only then will you be able to make an informed decision and be confident in your approach”. Source: Daily Business Post