Would you currently lock in to a 3 year fixed rate?

Boardz Fiend

Hi, just wondering if people would consider locking into a 3yr fixed rate on their mortgage in this climate. Or do you expect some help to come from the Government in the form of forcing banks to reduce interest rates? Eg, would be it be wiser to stay on Variable, or fix in for just one year to see if things change in that time?
My feeling is that the Govt (once formed) will make a bit of noise about helping borrowers but when push comes to shove, they wont take a hard line with the banks because the State has too much invested in the banks and needs them to be as profitable as possible. Any thoughts?

NIMAN

What rate are you paying now and what is the fixed rate you are being offered?

Are you currently on a standard variable?

Boardz Fiend

Thanks Niman. Currently paying 4.3% on Variable. Same bank is offering a Fixed Rate of 3.7%.

NIMAN

Boardz Fiend wrote: »

Thanks Niman. Currently paying 4.3% on Variable. Same bank is offering a Fixed Rate of 3.7%.

Is there a fee involved to move to fixed?

I think the way the world economy is, can't really see much of an increase in interest rates for the short term, so perhaps taking this small reduction might be a good idea.

Anyone else think the same?

screamer

Can't see the government doing anything that might negatively impact the banks profits as johnny taxpayer will be called in again....
Given that the banks are losing money hand over fist on trackers they will continue to squeeze every cent out of variable rate loans. Unfortunately the ecb rates have little influence on what the banks here chose to charge variable rate customers. I can only see variable rates rising as they get greedier TBH.

Boardz Fiend

NIMAN wrote: »

Is there a fee involved to move to fixed?

I think the way the world economy is, can't really see much of an increase in interest rates for the short term, so perhaps taking this small reduction might be a good idea.

Anyone else think the same?

Thanks NIMAN, no there is no fee involved.

NIMAN

Do you know how much you'd save each month?
Might not be a lot, but I'd be tempted to move to it anyway if its free, as I said I think there won't be any rise in interest rates anytime soon, and they can hardly go any lower either.

newacc2015

NIMAN wrote: »

Do you know how much you'd save each month?
Might not be a lot, but I'd be tempted to move to it anyway if its free, as I said I think there won't be any rise in interest rates anytime soon, and they can hardly go any lower either.

There is another firm seeking a license to start offering mortgages in Ireland. They are called Frank Money and are hoping to open by Q3 2016. A few UK banks are looking at the Irish market. Irish mortgages rates are insane compared to most of Europe

Trish56

If you're thinking of fixing I'd be inclined to opt for a 2 year fixed with the hope that rates will remain low for the next two years and then perhaps fix again for 5 years in the expectation that rates will increase eventually.

Are you in negative equity? as there are some great rates and offers to switch at the moment.

Boardz Fiend

newacc2015 wrote: »

There is another firm seeking a license to start offering mortgages in Ireland. They are called Frank Money and are hoping to open by Q3 2016. A few UK banks are looking at the Irish market. Irish mortgages rates are insane compared to most of Europe

Agree, Irish rates are insane. Completely unjust! Which is why I hoped the government would intervene to push rate more in line with Europe.

Trish56 wrote: »

If you're thinking of fixing I'd be inclined to opt for a 2 year fixed with the hope that rates will remain low for the next two years and then perhaps fix again for 5 years in the expectation that rates will increase eventually.

Are you in negative equity? as there are some great rates and offers to switch at the moment.

No, my house finally came out of neg equity last year. However I am on a restructured mortgage so cannot switch right now

NIMAN wrote: »

Do you know how much you'd save each month?
Might not be a lot, but I'd be tempted to move to it anyway if its free, as I said I think there won't be any rise in interest rates anytime soon, and they can hardly go any lower either.

Will save approx €150 per month

NIMAN

I'd say a no brainer then.
As I say, rates unlikely to move much, including downwards as your lender is unlikely to lower them and the Irish government have said before they don't interfere with how the banks run themselves.

Save €5400 over 3 years, go for it I say.

Boardz Fiend

NIMAN wrote: »

I'd say a no brainer then.
As I say, rates unlikely to move much, including downwards as your lender is unlikely to lower them and the Irish government have said before they don't interfere with how the banks run themselves.

Save €5400 over 3 years, go for it I say.

The Government were saying quite the opposite actually, last year they threatened banks with legislation to cut "exploitative" Variable Interest rates. (I would post links but as a new user I am not permitted).

It would kill me if I locked in for 3 years only to find the Government brought in legislation later this year to reduce rates...

feardeas

Boardz Fiend wrote: »

Hi, just wondering if people would consider locking into a 3yr fixed rate on their mortgage in this climate. Or do you expect some help to come from the Government in the form of forcing banks to reduce interest rates? Eg, would be it be wiser to stay on Variable, or fix in for just one year to see if things change in that time?
My feeling is that the Govt (once formed) will make a bit of noise about helping borrowers but when push comes to shove, they wont take a hard line with the banks because the State has too much invested in the banks and needs them to be as profitable as possible. Any thoughts?

I'm with BOI and fixed for two years last July. Saving €70 a month on the repayments. Just checked the rates there and they are the same as last July meaning that by next month I'll have saved €700. They [BOI] seem to be dead against moving on the SVR and have said so.

I don't think the government will act, maybe new players would help but switching only becomes a possibility when there is a fair bit of equity in the house which alas is not the case with me although what I now owe would be cleared by selling the house. First time I can say that since i bought the bloody thing in 08.

What I would like to see the government doing is to extend the period of interest relief. At least until there's some normality around the market.

km79

feardeas wrote: »

I'm with BOI and fixed for two years last July. Saving €70 a month on the repayments. Just checked the rates there and they are the same as last July meaning that by next month I'll have saved €700. They [BOI] seem to be dead against moving on the SVR and have said so.

I don't think the government will act, maybe new players would help but switching only becomes a possibility when there is a fair bit of equity in the house which alas is not the case with me although what I now owe would be cleared by selling the house. First time I can say that since i bought the bloody thing in 08.

What I would like to see the government doing is to extend the period of interest relief. At least until there's some normality around the market.

yes extending mortgage interest relief would be a welcome relief !
it was in FF election !manifesto.......

NIMAN

Can't see the Government interfering.

Trish56

Would hold off fixing for a month or two as Ulster Bank has just announced that they are reducing their 4 year fixed rate to 3.29% for a loan to value of 60%.

They are reducing all their fixed rates so I reckon all the lenders will reduce rates in order to compete.

km79

Trish56 wrote: »

Would hold off fixing for a month or two as Ulster Bank has just announced that they are reducing their 4 year fixed rate to 3.29% for a loan to value of 60%.

They are reducing all their fixed rates so I reckon all the lenders will reduce rates in order to compete.

but still leaving their varaiable well over 4%
for someone like us whose LTV is pretty much 100% they will do nothing

Trish56

Exactly they are screwing the people who are in negative equity or whose loan to value is high as they know they can't lose them. Their Variable rate is one of the highest at 4.30% with Bank of Ireland leading the pack at 4.50% and the Government or Central Bank wont do anything about it.

km79 wrote: »

but still leaving their varaiable well over 4%
for someone like us whose LTV is pretty much 100% they will do nothing

iainBB

There is more to this fixing and switching stuff.

Ulster B are have just offered a new rate depending on LTV but could be as low as 3.25% for fixed amount of time but after the fixed rate term is up they will put you put on a high rate of 4.3% where they make the big bucks again.

They know that people changing work/ family circumstances will restrict them from moving to another mortgage company. banks see things in the long term 10 plus years.

Short term fixing for a year or so with low rate and then high variable rate later with the extra cost of solicitor fees and valuation may not be worth it.

we are on 3.9% at current and UB are offering 3.25 3 years fixed then up the var rate to 4.3% when 3 years are up.

We may have a new job kids by then which would impact changing it again.

tendjose

Hi,

I'm buying but undecided between going for a variable rate, 3 years fixed, or 5 years fixed.

What's your advice?

Thanks

ted1

How are you with AIB offer much lower rates

ted1

newacc2015 wrote: »

There is another firm seeking a license to start offering mortgages in Ireland. They are called Frank Money and are hoping to open by Q3 2016. A few UK banks are looking at the Irish market. Irish mortgages rates are insane compared to most of Europe

They got burnt last time so can't see them offering much lower rates.

To get lower rates the government need to make repocessions easier so they can reduce their losses. The cost and effort in repocessions here is ridiculous compared to the rest of Europe and is why we have such high rates