Apr rate for fixed term mortgage

portlaire

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EBS are offering a fixed term apr that is less than my current variable rate. How does this make sense, I would have taught they are taking on more risk by fixing the rate and as such it would be higher. The same confusion on their 3 and 5 year fixed terms I.e the 3 year fixed is less than the 5 year fixed rate (3.8 vs 3.9). Would appreciate if someone good explain or maybe point out if I am looking at the wrong thing?
Thanks
 
I presume you are referring to a fixed rate being lower than the variable rate?

Given that the ECB rate is 0.05% one would expect that variable rates can only rise.
Therefore the fixed rates should be higher than the variable rates.

But...

Irish lenders are charging borrowers extortionate variable rates. Some of us are campaigning to have them reduced. I think that this will succeed in time. Maybe it will take a new entrant.

So the Irish lenders must be expecting to lower their variable rates. But if you have fixed for 5 years, you will be stuck with the extortionate high rate.

Brendan
 
Irish lenders are charging borrowers extortionate variable rates. Some of us are campaigning to have them reduced. I think that this will succeed in time. Maybe it will take a new entrant.

So the Irish lenders must be expecting to lower their variable rates. But if you have fixed for 5 years, you will be stuck with the extortionate high rate.

Brendan


Brendan you say that you are campaigning to get the rates reduced but in reality do you think this will actually happen? and if ever when.

I too am in the same boat as "portlaire" and considering moving from a variable to fixed for 3 or 5 years at the 3.8/3.9% rate.
Are you guessing that these fixed rates could be reduced further and if so when.
 
Thanks for replies guys at least the difference in the variable and fixed rates make some sense now. It's still a little off that the 5 year term is a higher rate than the 3 year you'd think they would be trying to get people onto the 5 year fixed if they think it is going down. I might chance the 3 year, as it saves me quite a bit compared to my current variable and hopefully it comes down further by the time I'm out.
Thanks again.
 
Brendan you say that you are campaigning to get the rates reduced but in reality do you think this will actually happen? and if ever when.
.

Hi brophy

I don't have a non-tracker mortgage, but I seem to be the only one doing anything about it.

If the 300,000 people who are paying about €400 a month too much, get off their rear ends and start campaigning on it, it will happen sooner. But if I am the only one raising the issue, then it won't happen.

Brendan
 
Hi brophy

I don't have a non-tracker mortgage, but I seem to be the only one doing anything about it.

If the 300,000 people who are paying about €400 a month too much, get off their rear ends and start campaigning on it, it will happen sooner. But if I am the only one raising the issue, then it won't happen.

Brendan

How are you doing anything about it? of course I would like to push the financial institutions but how does one go about this?

Where are you raising the issue and who with?

Thinking I might as well go with the 3 year fixed as its a decent reduction on the amount and then hopefully between force of people of the entry into the market of another financial institution the rates will have dropped by the time the term ends.
 
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