Fixed interest rate 'offer' from the bank.

SarahMollie

iainBB wrote: »

agreed
that is reason why the letter are in your door from the bank about fixing your mortgage now. ( its marketing department looking for suckers )
get a fixed rate for 1,3,5 years while var rates drop over the coming months.

People have been saying this for years and it hasnt happened.

The market here is what it is. Few players and they're all trying to make large profits to offset a considerable portion of non performing loans already on their balance sheets.

Unless real competition enters the market, I don't think anything overly dramatic will happen. All we've seen so far are a few sub prime lenders, but no real competition for the main banks.

DD, if it sounds like a good deal for you, then go for it.

iainBB

SarahMollie wrote: »

People have been saying this for years and it hasnt happened.

The market here is what it is.

People "may" have been saying this for years but the facts are different now a days.
Many banks are starting to offer fixed rates and locking customers in now much lower then their var rate. why is this changed all of a sudden.
One big switch has struck a deal with UlsterBank for a low locked in fixed rate if you switch and stick with them.
In the news there is plenty of references to new players in the mortgage sector in Ireland
In the news euro rate are way low compared to Ireland rates.
Euro central bank rates are at an all time low and not moving any time shortly.
all signs point to var rates going down

fix if you want stay with var if you want. it is of course your decision.
we can only talk about it here and give you the facts.

SarahMollie

iainBB wrote: »

People "may" have been saying this for years but the facts are different now a days.
Many banks are starting to offer fixed rates and locking customers in now much lower then their var rate. why is this changed all of a sudden.
One big switch has struck a deal with UlsterBank for a low locked in fixed rate if you switch and stick with them.
In the news there is plenty of references to new players in the mortgage sector in Ireland
In the news euro rate are way low compared to Ireland rates.
Euro central bank rates are at an all time low and not moving any time shortly.
all signs point to var rates going down

fix if you want stay with var if you want. it is of course your decision.
we can only talk about it here and give you the facts.

You've provided no specifics and are saying nothing new.
Who are these new players? I can only think of one and they're subprime. They're not competing with AIB, BOI etc.
They might go lower, but then DD is paying at her higher Std Var rate while he/she sits back and tries to game the market.
Instead, what I'm advocating is for DD to look at the numbers and see if they can live with them for the period of 2 years. Is the reduction on their current rate worth locking in for that amount of time.
Its always possible that things will change, but 2 years is not forever, and if the rates do go lower, it will be gradual.

Certainly I wouldn't be advocating for anyone to fix for 5/7 years or anything like that, but for 2 years, at that rate, I don't think thats half bad.

iainBB

SarahMollie wrote: »

You've provided no specifics and are saying nothing new.
Who are these new players? I can only think of one and they're subprime. They're not competing with AIB, BOI etc.
They might go lower, but then DD is paying at her higher Std Var rate while he/she sits back and tries to game the market.
Instead, what I'm advocating is for DD to look at the numbers and see if they can live with them for the period of 2 years. Is the reduction on their current rate worth locking in for that amount of time.
Its always possible that things will change, but 2 years is not forever, and if the rates do go lower, it will be gradual.

Certainly I wouldn't be advocating for anyone to fix for 5/7 years or anything like that, but for 2 years, at that rate, I don't think thats half bad.

Nothing new a no specific, why bother

what was not new? one big switch( 19 April 2016 ) what is new to you
http://www.irishexaminer.com/ireland/one-big-switch-gets-better-mortgage-offer-from-ulster-bank-393717.html

call for similar mortgage switching 25th of April 2016
http://www.irishtimes.com/business/personal-finance/call-for-simpler-mortgage-switching-1.2624219

new leader 24 April 2016
http://www.independent.ie/business/personal-finance/new-lender-aiming-to-undercut-banks-on-mortgage-rates-34652870.html

Not bother any more with more references
sometime arguing with people is like giving medicine to the dead.

SarahMollie

OK, first two links are nothing new. You can keep you medicine, thanks.

The rate that the One Big Switch crowd managed to achieve is not as good as what DD is being offered.

The second one is just "calls for improvement"....heard that one before alright. Do you remember Michael Noonan calling all the banks in a telling them to lower their rates? Not exactly effective.

Final one might be interesting, but they're still a way off actually operating in Ireland. It also sounds like they'll be pretty selective in terms of which customers they'll agree to take. Also, there are no dates given as to when the expect to start lending. DD could be half way through the 2 years by that point.

DD has already said they don't particularly want to switch lenders anyway.

D_D

I don't to start a 'fact vs. fiction' war on Boards, but I suppose I am siding with SarahMollie. Why wait to play the market when I am currently being offered a way better deal as is for two years? I have been playing the waiting game for three years already and haven't come out the better, even with the current mantra that 'variable rates will definitely drop, they have to'.

If they are going to drop, they will be still there in two years time, and I will avail of them then. Or fix again.

Also, it isn't worth my hassle to switch mortgage providers during the two years I'm 'locked' into the BOI mortgage as I don't think there will be other providers going crazily below the 3.35% I am being offered.

athtrasna

Mod note
That's enough bickering folks. This is not about scoring points or taking sides. Posters are asked to remain civil and to post in accordance with the forum charter.

Thanks

kodak

Would appreciate thought's on this one!

1st time buyer

Offer 1: 200K >80% LTV - 3.75% variable (25 years)
Offer 2: 200K >80% LTV - 3.65% fixed for 5 years with 4K cash back (20 years or 25 years)

I would have ability to overpay variable so I would probably take the fixed over 20 years...

newacc2015

SarahMollie wrote: »

People have been saying this for years and it hasnt happened.

The market here is what it is. Few players and they're all trying to make large profits to offset a considerable portion of non performing loans already on their balance sheets.

Unless real competition enters the market, I don't think anything overly dramatic will happen. All we've seen so far are a few sub prime lenders, but no real competition for the main banks.

DD, if it sounds like a good deal for you, then go for it.

Frank Money is seeking a license from the central bank to start issuing mortgages by Q3 this year. Competition is entering the market now and they are promising to slash rates.

A foreign bank could open here tomorrow and take advantage of the lowest savings interest rates in Europe and one of the highest mortgage interest rates tomorrow. If you were a German bank, you would literally have double the margin on mortgage lending in Ireland versus Germany

Ask yourself, why would a bank wanting to maximise revenue want you to save money by fixing your mortgage? I would imagine they are expecting a competitor to cut their rates

iainBB

newacc2015 wrote: »

Frank Money is seeking a license from the central bank to start issuing mortgages by Q3 this year. Competition is entering the market now and they are promising to slash rates.

A foreign bank could open here tomorrow and take advantage of the lowest savings interest rates in Europe and one of the highest mortgage interest rates tomorrow. If you were a German bank, you would literally have double the margin on mortgage lending in Ireland versus Germany

Ask yourself, why would a bank wanting to maximise revenue want you to save money by fixing your mortgage? I would imagine they are expecting a competitor to cut their rates

Agree
The problem is mortgage rates change very slowly some waiting for the last 3 years has gotten no where. they got an offer now to fix and thank it's a good idea.

I was on to my bank yesterday about changing their rate down to below 3.3 var. They where very happy to discuss it.

newacc2015

BOI shares are down as investors are worried that the new Government plans might mean they have to cut their variable rate

http://www.irishtimes.com/business/financial-services/bank-shares-fall-as-investors-rattled-by-new-government-plan-1.2637591

No bank is going to try and save its customers money. I would be surprised if BOI cuts their variable rates in a few months due to pressure

Villa05

SarahMollie wrote:

I'd put the question straight to BOI, but I don't believe the assertion above.

SarahMollie wrote:

Also, there isnt just one Variable Rate. There are multiple rates depending on your LTV.

It is correct and is in the small print. LTV rates are a different product to standard variable. BOI are very sneaky and have cunning ways of catching you out. Short term gain for long term pain should be there motto

I would advise on holding off on fixing long term. The new government have been tasked with shaking up the market by trying to make it much easier and cheaper switch plus downward pressure on variable rates.
It will probably be a government survival issue this time round

iainBB

more news on this front.

mortgage rates are going to be cut.

http://www.irishexaminer.com/business/squeeze-on-saving-rates-as-mortgage-cuts-loom-398802.html


I was to to my Bank yesterday about a var rate cut to below 3.3 percent.

iainBB

As I said variables rate will be cut shortly


more evidence of a variable rate cut coming down the line and why the bank have offered the fixed rate to customer to suck them so they can no benefit from the rate cute.


http://www.independent.ie/business/personal-finance/property-mortgages/banks-slash-interest-rates-on-mortgages-in-fear-of-new-lender-frank-money-34721268.html

cocoa123

Just wondering if I can get your opinions on the following offer from the bank:

I'm currently choosing between 3 options with new UB rates for LTV <80%

1. 3-year fix 2.99% (Fix does not allow over-payments, however it's unlikely I'd be able to make over-payments withing next 3 years)

2. var 3.1%. (can leave to fix rate at anytime)

3. split between two above

Does it worth for fix for 3 years now? The option of var with possibility to fix look me more attractive because the gap between var and fix is only 0.11% and with only one var rate move down would set a parity. Also if rates continue to go down further I would be able to fix lower than current 2.99%. But I can be wrong as I have no clue in banking just simple maths analysis.
Cheers!

draiochtanois

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