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Ulster Bank Mortgage 2.6 % fixed or 3% variable ?

  • 08-04-2018 10:16am
    #1
    pajosjunkbox
    Registered Users Posts: 375 ✭✭


    Hi,

    I am getting a mortgage from Ulster bank and have the option of 2.6 % fixed for four years or 3 % variable. I'm not sure what the best option is. Does anyone have any opinions ?

    Also why does the 2.6% fixed have an APR of 3.7% and the 3% variable has an APR of 3% ?

    Is it impossible to give a proper APR as rates will change throughout the lifetime of the mortgage ?

    If anyone more in the know than myself could help I would appreciate it.

    Thanks


Comments

  • #2
    KyleJJE
    Registered Users Posts: 81 ✭✭KyleJJE


    Thought the best from ulster bank was 2.9%?


  • #3
    JTMan
    Registered Users, Registered Users 2 Posts: 5,541 ✭✭✭JTMan


    I would personally choose 2.6% Fixed over 3.0% variable. Hard to see variable rates declining to 2.6%.
    Thought the best from ulster bank was 2.9%?

    No, 2.6% is the best from Ulster Bank.


  • #4
    pajosjunkbox
    Registered Users Posts: 375 ✭✭pajosjunkbox


    How does 2.6 % compare to the rest of the Irish market ?


  • #5
    mirrorwall14
    Closed Accounts Posts: 6,751 ✭✭✭mirrorwall14


    pajosjunkbox wrote: »
    Hi,

    I am getting a mortgage from Ulster bank and have the option of 2.6 % fixed for four years or 3 % variable. I'm not sure what the best option is. Does anyone have any opinions ?

    Also why does the 2.6% fixed have an APR of 3.7% and the 3% variable has an APR of 3% ?

    Is it impossible to give a proper APR as rates will change throughout the lifetime of the mortgage ?

    If anyone more in the know than myself could help I would appreciate it.

    Thanks

    APR is what you should be comparing, which makes more sense since it would be unusual to have the fixed rate coming in below the variable. You would expect the bank to be charging you to fix the rate and remove your risk. If its increasing their risk then there is a premium to be paid. APR is the comparison annual rate and is designed to be clearer for consumers to see which rate is actually the better value

    And their website is a bit shady in that regard to be honest, I had to go back to the homepage to find the APR in the small print.


  • #6
    pajosjunkbox
    Registered Users Posts: 375 ✭✭pajosjunkbox


    So really if you compare the fixed rate to the variable rate , the variable rate is better value due to having a lower APR ?


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  • #7
    phormium
    Registered Users, Registered Users 2 Posts: 3,345 ✭✭✭phormium


    No, the lower fixed rate is better. Compare the cost per thousand per month in repayments, that is the real cost to your pocket every month. APR only works to a certain extent and is taking into account the full term.

    Ask the bank for the CPT or even just the repayment amounts, that will show you the cheapest assuming you are not going to be penalised at the end of the fixed by going to a higher variable than other customers.


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