Interest rates for mortgages

Kornelia

Hi everyone,

Just a quick question on interest rates. I'm drawing down on a mortgage and the current trend is to go with a fixed rate.

Can anyone advise me?

I originally wanted a 2.95 variable rate but I heard they will go up in the next while, so am I safer to go with a fixed rate? AIB are offering the lowest fixed rate for 5 years 2.1% for a new home with an A1 to B3 rating.

Thanks for your advice.

bilbot79

Everyone to their own opinion but as far as I'm concerned right now if you don't fix the rate you could lose your house.

Kornelia

Thanks very much for your response. Its a good idea to fix it and any left over money could be saved in case I want to change to a variable down the line, coz the advisor said I can put down as much money as I want without being penalised.

If you are determined to buy fix for as long as possible. 10yrs +. Start putting away money every month for when you come out of that fixed rate.

Liam O

There is an absolutely massive difference between those 2 rates in terms of how much you'd be paying monthly at the start of the mortgage, above €150 for most normal amounts 300-500k anyway.

5 years is a good term on that fixed rate with AIB as you don't know where they'll be any longer than that. ECB rates due to rise but unsure if that will be passed on to variable rates directly as it sometimes was in the past, but safe to assume there will be a bit of a rise. Very unlikely a variable rate gets below 2.1% in the near future based on that.

I'd go with the fixed rate out of those options, presume it's too high an LTV for Avant?

Kornelia

https://www.boards.ie/discussion/comment/119299312#Comment_119299312

Im paying back 183k. So its not too bad. What does LTV for Avant mean? What does ECB mean? I also applied for a loan with the local authority home loan but they haven't sent me an offer yet.

Geuze

2.1% fixed for five years is a good rate.

LTV = Loan-to-Value

ECB = European Central Bank

Sarn

Just be aware that AIB rate is unlikely to be available in a few weeks when the ECB rates go up, so drawdown the mortgage as quick as you can.

podge1979

https://www.boards.ie/discussion/comment/119301682#Comment_119301682

Thats easier said than done, find AIB really frustrating at the moment on switcher mortgage their drip feeding documents needed. At it a few months now (started the process in April). Seems that the a multiple people picking it up in the app. Would much prefer the old face to face option.

Kornelia

I just got an offer from the Local Authority Home Loan. They offer a 2.845 fixed rate for 25 years. AIB only offered the 2.1 fixed rate for 5 years and then who knows what happens. What are people's thoughts?

WealthyB

https://www.boards.ie/discussion/comment/119404716#Comment_119404716

The old adage always applies - fixed rates for security. Noone knows what interest rates will be in 5 years. Personally, I think the euro as a concept is doomed, and there's a seismic change coming down the tracks, but don't mind me I'm just a randomer with no financial background. FWIW I fixed for 10 years with AIB a few weeks back. The peace of mind is worth the increased payment which I can easily absorb.

Iriah251

Hi can I ask what council you applied to? Wev been waiting 5 months with sdcc