AIB Mortgage Rates

deeks

I'm currently on an AIB Standard Variable rate which was recently reduced to 4.15%. I noticed on the leaflet specifying the new rates that the 2,3,4 and 5 year fixed rates are lower than the standard variable rate (see link)

http://personal.aib.ie/our-products/mortgages/mortgage-interest-rates

Simple question is would anyone recommend fixing into one of these rates or are these lower rates an indication that the bank expects variable rates to fall significantly over the next few years?

Dinarius

I noticed that too.

Has that happened before?

Obviously, they're trying to lock people into fixed rates.

Presumably, they believe the standard variable has further to fall.

The difference between what they're borrowing money from EU at (<1%) and selling it back into the market at is scandalous. So, a reduction in the Standard Variable is long overdue.

I would tend to sit tight. I suspect that come election time (we all but own AIB, remember) the rates may be even lower - and then rise again after the election.

Cynic?! Moi?!

D.

deeks

http://www.independent.ie/business/personal-finance/cuts-to-mortgage-rates-as-aib-caves-in-on-variables-31164679.html

At least things appear to be moving in the right direction anyway.

Gerlad

deeks wrote: »

http://www.independent.ie/business/personal-finance/cuts-to-mortgage-rates-as-aib-caves-in-on-variables-31164679.html

At least things appear to be moving in the right direction anyway.

Good to see although the Indo really is a rag when you see the story they printed yesterday

http://www.independent.ie/business/personal-finance/property-mortgages/aib-not-prepared-to-cut-variable-rates-further-says-ceo-31162024.html

Chris_5339762

He said a decrease of 0.25pc would save a family €500 a year on a €200,000 mortgage - but a 1pc decrease would save that family €2,000 a year.

Well done that man, he can multiply!

danmanw8

There's no commitment there yet to reduce rates.

He said they would IF their costs keep falling. Not holding my breath!!

Trackers are one of their "costs" and all of us on Variables are basically paying on behalf of those on trackers. The cost of trackers isn't going to fall unless they increase the rates on those.

murphaph

It's widely accepted that trackers are no longer loss making for the banks. Maybe better to look at the real reason rates are relatively high in Ireland: extreme difficulty and expense faced by banks seeking possession of properties where the mortgage is not being paid.

danmanw8

Heard on newstalk this morning that AIB were knocking 0.25% off variables in June

danmanw8

danmanw8 wrote: »

Heard on newstalk this morning that AIB were knocking 0.25% off variables in June

Yep here it is: http://www.rte.ie/news/2015/0501/697996-aib-economy/

Dinarius

Only chance of rate reduction is if base rates rise to meet them in the middle. e.g. Trackers paying, say, 2.5% + 1%. Then those on variable would be paying about the same.

But, because cash has had nowhere to go in the last five years (no interest paid on savings) all money has gone into the stock market - hence the repeated DOW, FTSE and NIKKEI highs.

As a result, the stock market is now insanely over-valued, based on any reading you care to apply.

So, any hike in rates could provoke a flight from the stock market and cause a crash.

Can't see rates rising any time soon.

FED et al are stuck between a rock and a hard place.

D.