Considering Switching Mortgage Provider? The Process Explained

Considering Switching Mortgage Provider? The Process Explained.

With recent ECB interest rate cuts, some lenders have lowered their fixed and variable mortgage rates and are offering cash-back incentives to switchers. However a recent study conducted by the Banking and Payments Federation of Ireland (“BPFI”) found that just 28% of mortgage holders have considered switching in the past six months (https://bpfi.ie/publications/bpfi-mortgage-switching-research-survey/).

To promote the benefits of switching, which include lower interest rates, better lending terms and the ability to either top-up or make a lump sum payment and reduce monthly costs, and provide information about the process involved, BPFI have launched a website which provides guidance on switching mortgage providers, which can be found at https://bpfi.ie/in-your-interest/ .

Switching mortgage providers can lead to significant cost savings over time, but it’s essential to understand the legal and procedural steps involved to make an informed decision.

The purpose of this article is to complement the information provided by BPFI and inform you of the legal process involved when switching mortgage providers and what to expect when engaging Amorys Solicitors LLP to act on your behalf in this process.

The Legal Process

Step 1: Taking Up Title Deeds

The first step after making contact with Amorys is to take up your title deeds from your existing lender. We will draft an authority for you to sign which will request that your title deeds be provided to Amorys upon payment of a small fee, usually around €63. It may take 4-6 weeks for title deeds to be received from your bank.

Amorys will provide an undertaking, or promise, to either return title deeds to your existing lender or to repay your loan in full, with the proceeds of your new mortgage.

Step 2: Your Loan Pack/Mortgage Documentation

You will be asked by your new lender or mortgage broker to provide details of your solicitor acting for you throughout the switching process. Your new lender or broker will send directly to Amorys your letter of loan offer containing details of your new mortgage terms and any conditions/documentation to be provided prior to drawdown of funds.

Step 3: Review Title Deeds

Once received, Amorys will review your title deeds to ensure that everything is in order, including registration of the property in your name(s) and that your existing lender’s charge is also registered. In the unlikely event that title issues become evident throughout our review, we will inform you of this.

Step 4: Attendance at our Offices

We will request that you attend our Sandyford or Greystones office for a meeting with one of the Amorys team. In this meeting you will sign the mortgage documentation including your letter of offer and a family home declaration, in which you will declare your current marital status.

You will need to be in a position to provide us with a copy of your civil marriage certificate and/or any other documentation pertaining to a divorce or separation if applicable.

Please note that whilst we will advise you on the legalities of the mortgage documentation you will be signing, we cannot give advice on your mortgage application.

Step 5: Redemption Figures

Once you have signed the new loan documentation with us and we have returned the signed documentation to your new lender, we will request confirmation of the exact amount which is to be repaid to your existing lender. This amount will be as at the date of the letter and include an amount for interest which accrues daily.

For example, if redemption figures for your existing loan are received on 1^st November and total €100,000, interest will continue to accrue until the existing loan is repaid. If your loan is repaid on 10^th November and your daily interest rate is €5, the balance payable to your existing lender will be €100,050 (10 days of interest at €5 per day).

Step 6: Drawdown of New Loan

Once all documentation has been provided to your new lender we will request release of your new mortgage funds to our client account.

Step 7: Repaying your Existing Lender

Upon receipt of your new loan funds, plus funds payable by you to Amorys, we will carry out searches to ensure there are no judgements against you or other mortgages/charges affecting the property.

Assuming searches are clear, we will arrange the payment of the outstanding mortgage amount to your existing lender as set out in the redemption figures at Step 5 above. We will generally add a small amount to cover interest accruing throughout processing.

Once payment is received by your existing lender your direct debit will be stopped and you will then make payment to your new lender as agreed.

Step 8: Registration

Amorys will register the change of mortgage providers with Tailte Eireann, formerly the Land Registry on your behalf. Once registration is completed, we will provide you with a Land Registry Folio showing your ownership and the new lender’s mortgage on title.

Step 9: Return of Title Documents

Once registration is complete, we will send your title documentation to your new lender, who will hold the documents until you wish to deal with the property in future, or until you pay your new mortgage in full.

From redeeming title deeds to final registration, each step in the mortgage switching process requires careful handling to avoid unexpected delays or issues.

Amorys Solicitors LLP offers a competitive fixed price for clients wishing to engage our firm to assist with mortgage switching. For more information regarding the switcher mortgage process, please contact Emer Cassidy emer@amoryssolicitors.com , telephone 01 213 5940 or your usual contact at Amorys on our email address at info@amoryssolicitors.com .