Fix with AIB or BOI and for how long?

BMD

Hi,

I have narrowed down my mortgage options to AIB and BOI (best rates available) and have been approved by both, however I want some advice on who I should go with and how long I should fix for.

My options are as follows;

AIB - 3 year fixed at 3.89%. This is the best three year rate available however it wont be fixed until I draw down the last payment (its a self build) in ~ June 2011. If I go with this, what do you think the maximum their 3 year rate could be in June (I assume it will have gone up by then). After the three years I would move onto their standard variable rate (3.25% at present). Not fixing now might also be a benefit as I could re-asses the economic climate in 6 months time?

BOI - 2 year fixed at 3.4%. This is the best 2 year rate at the moment and I can fix straight away...however is 2 years long enough given the current climate. What could we expect the variable rate to be in December 2012? Again I would be going onto their standard variable rate at the end of the fixed term (3.35% at present)

BOI- 3 year fixed at 4.04%. This might give me the reassurance of getting on a 3 year rate immediately, however its higher than AIB which is putting me off

I have started my self build and therefore need to get this sorted pretty soon as the builder will be looking for first payment soon. I'm a little further down the track with AIB than with BOI wrt submitting documentation etc. BOI also insist on an independent valuation

I'm not comfortable going with a 5 year fix as the difference at present is €200 PM and 5 years is a long time

Any advice anyone has one this would be appreciated.

pjmn

If it's security of price (repayment) that you are looking for then BOI would cost you c. E8 per month per E100k more than AIB - you'll have to decide if it's worth paying that premium, bearing in mind that AIB aren't really committing a fixed rate to you at this time. Personally I think I would, but it really depends on your own circumstances...

Do I take it from your post that AIB aren't seeking a valuation? I would have thought that to be unusual.

BMD

Any further advice on this? Have to decide early next week and really don't know what way to go

BMD

PJMN...AIB accepted our own valuation from Estate agent we contacted...it seems that BOI want an independent valuation