Is It Worth Switching for 0.5%? The Real Numbers
Half a percent sounds tiny. But on a €300,000 mortgage over 25 years, a 0.5% rate reduction saves approximately €19,000 in total interest. Here's the full breakeven analysis.
The Impact of 0.5%
| Rate | Monthly Payment | Total Interest (25yr) |
|---|---|---|
| 4.00% | €1,584 | €175,200 |
| 3.50% | €1,498 | €149,400 |
| Saving | €86/month | €25,800 |
That's €86 per month or €1,032 per year back in your pocket, every year, for 25 years.
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Breakeven Calculation
Net switching costs (after lender contribution) are typically €500–€1,500. At €86/month savings, you break even in 6–17 months. After that, it's pure savings.
| Balance | 0.5% Monthly Saving | 25-Year Total Saving | Breakeven (€1,000 cost) |
|---|---|---|---|
| €200,000 | €57 | €17,100 | 18 months |
| €250,000 | €71 | €21,300 | 14 months |
| €300,000 | €86 | €25,800 | 12 months |
| €350,000 | €100 | €30,000 | 10 months |
The answer is almost always yes. Unless you plan to sell within 12 months, switching for 0.5% is worth it. And if you can unlock a green mortgage discount (0.1–0.3% extra), the case is overwhelming. Get your BER at Homerating.ie