Irish Mortgage Corporation

Mortgage holders use lower repayments for savings, paying off debt, charity and summer holidays!

This survey was undertaken during the months of April & May 2009 to existing mortgage holders. Its purpose was to examine how mortgage holders, who have benefited from reductions to their monthly mortgage repayments, have managed those savings.

• Just over two-thirds of all clients who responded have a variable rate mortgage (standard variable or tracker).
• Of those on a variable rate mortgage, 42% have experienced a drop in their monthly mortgage repayments of between €250 and €500 as a result of the fall in interest rates since September 2008.
• A further 21% on a variable rate mortgage said they are seeing savings in excess of €500 per month on their repayments

Mortgage savings managed as follows:

• 44% of people who have benefited from a reduction to their mortgage repayments say that they intend to use some of the reductions to set up a savings account.
• 43% plan to use some of the reductions to pay for a summer holiday.
• 33% will use some or all of their savings to pay off other outstanding debts.
• Around one-in-five (21%) have opted to pay a little extra off their mortgage,
• A further 21% of respondents plan to give some form of donation to charity.
• 17% have set-up a college fund for their children, while just
• 15% plan to put some or all of their savings on their repayments into a pension fund.

(Respondents selected more than one option)

Commenting on the findings, Mr. Frank Conway, Director with Irish Mortgage Corporation said, “The results show that borrowers are being prudent and very conservative with their money. Putting money into a savings account, paying off loans and paying down their existing mortgage is a very common theme. However, interestingly and despite the economic gloom or perhaps because of it, many respondents are determined to take their summer holidays and are using some of the savings from their mortgage repayments to pay for it. It appears that summer holidays have become an important part of ‘family time’ which many people are not about to give up”

Another theme to come out of this survey is one of humility with many respondents planning to make some donation to charity.

“A full 21% of respondents say that they intend giving some form of donation to charity. This is an astonishing number. What is more interesting is that in 2005 and 2006, we conducted a similar survey among SSIA savers and when asked how they planned to use their windfall, charitable donations featured much lower. In 2005, only 1.4% of people intended giving some of their savings to a charity. In 2006, this had risen to 3.6%. It would appear that the current economy, while dreadful, may be making us all a little more caring,” said Mr. Conway.

For further details, please contact:
Frank Conway
Director
Irish Mortgage Corporation 118 Lr. Baggot St. 01 669-1015 This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Warning: The cost of your monthly payments may increase, if you do not keep up your repayments, you may lose your home.
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