Ending fixed rate- choose variable,fixed or tracker?

Rangemaster

Registered User
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Fairly clueless about mortgages. Help/suggestions would be very much appreciated. Options are
Ltv var 3.75%. Apr 3.82
1year fixed. 3.5%. Apr 3.682
2years fixed 3.6%. 3.689
3years fixed 3.65%. 3.7
5years fixed 3.8%. 3.778
We also got the option of a tracker which doesn't sound great to me it's
Commercially priced prevailing tracker rate of 3.72% Ecb 0.05% plus a margin of 3.67%
Ideally I would like to fix for more than 5 years but that option is not available so I would be inclined to fix for 5 years
 
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Hi Rangemaster, from looking at your rates I would suspect that you are with AIB as I have received the same letter.
I have requested all the documentation that the bank has on my file as I believe they are trying to pull a fast one with their euphemistically phrased "Commercially priced prevailing tracker rate" !

Has anyone else queried this with the bank a gotten anywhere ?
 
If this "Commercially priced prevailing tracker rate" behaves like a traditional tracker rate, then I would probably avoid it, because the margin is so much over the ECB rate. The current ECB rate of 0.05% is at an all-time low. If and when (i.e. when) this rate goes up, your tracker rate would go up by a corresponding amount, e.g. by 0.25% to 3.97%. However, their other rates may not automatically go up by the same amount. This is because they are relatively high right now, compared to the base rate, so the bank could possibly afford to maintain them at current levels, even with an increase in the ECB rate.

As Rangemaster is inclined to fix long-term anyway, then 5 years look like the best option. Ulster Bank offer a 7 year fixed option though for as low as 3.60% though, and €1,500 towards switching fees, so that might be attractive.

I would also recommend shopping around for other options. If your property is not in negative equity, then there might be better deals out there. Many other banks are also offering cash incentives to entice switchers.

Best Regards,
Dave Curry, Irish Mortgage Corporation
 
Calculate your LTV first and go compare the relevant Rates currently on offer for your LTV.
Don't be afraid to switch lenders but do take your time comparing Rates (together with the relevant switching incentive, on offer).
I recently came out of a 5yr fixed period, switched to ULB and fixed again.
Good luck!
 
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