What's the chance AIB increase standard variable rate?

Hi there,

My husband and I have been on a fixed rate mortgage of 4.75% with AIB for the last three years. Our rate comes to an end on Sept. 15th, so we are currently trying to figure out what our next move should be.

At the moment, we pay €1330 a month before TRS. The new options AIB have give us are as follows:
Variable Rate (2.25%) - €970
2 year fixed (2.8%) - €1045
3 year fixed (3.19%) -€1100
4 year fixed (3.57%) - €1155
5 year fixed (3.86%) - €1200

While we know we are going to make a saving on what we currently pay, we really do want to try and get the best deal for ourselves as we have been screwed by the bank for the last 12-18 months! We are considering staying on the variable rate for a few months and maybe when the rates start to go up we might fix it. Now, while we would have only had to watch the ECB rates, after what PTSB did last month, we are somewhat wary of AIB just increasing their variable rate as well. What do you think the chances of this happening are?

Also, we would really appreciate some sound advice if anyone has any to offer. We have just gotten married and are considering starting a family, so any extra cash we can save will definitely come in handy. Conversely, if we were to start a family, the comfort of knowing exactly how much our mortgate repayments are on a fixed rate would also be attractive.

Aaaaarrrghh, this is so hard!

If an increase in interest rates will overstretch you then it would be worth fixing. If you can handle interest rate increases then go with the variable.

If you do have children then you can fix when that happens as money will be tighter. Just remember that if you fix and you need to move to a bigger property there may be a penalty for breaking the fixed rate mortgage.

Do not fix to try and time the market.


www.moneybackmortgages.ie

Hi Mrs. Moody,

We are also with AIB and we fixed for 4 years at 3.57% recently. We think the variable rates will start to go up by March/April next year. We don't think the current fixed rates will still be avail at that stage. Just our opinion!!

Best of luck,

Kate.