EBS cuts fixed rates -but not its variable rates

[Lightning]

From Charlie Weston in the Indo here.

Existing customers of EBS are set to be disappointed as the lender confirmed it is not cutting its variable rate.

However, the former building society, which is part of AIB, is slashing its fixed rates for new and existing customers.

These lower fixed rates are set to challenge Bank of Ireland, Ulster Bank, Permanent TSB and KBC Bank. EBS is also extending its popular 2pc cash-back offer for first-time buyers and switchers.

 

[Lightning]

9thOctober 2017


EBS reduces fixed mortgage rates and extends 2% back in cash offer


• All fixed rates reducing with the 3 year fixed down to 3.15% and 5 year fixed down to 3.25%
• €6,000 back in cash on a €300,000 mortgage
• Mortgage Masters to help people achieve their dream of home ownership

EBS today (Monday, 9thOctober) announced significant reductions in its fixed mortgage rates for new and existing*Private Dwelling home mortgagecustomers and the extension of its 2% back in cash offer for new mortgage customers.



All EBS fixed rates are reducing, with the 3 year fixed down to 3.15% from 3.65% and the 5 year fixed down to 3.25% from 3.80%.



The 2% back in cash offer has been extended to eligible customers, including switchers,whose mortgage draws downbefore 31st March 2018. EBS customers will continue to receive €2,000 back for every €100,000 in new mortgage borrowing drawn down.



EBS Chief Executive Des Fitzgerald said:

"Customers, especially first time buyers, have a strong appetite for cash offers in addition to very competitive mortgage interest rates.”



“Our back in cash offer has been very popular since we started it in June of last year. This extension of our offer, coupled with EBS’s reduced fixed rates offers great value to our customers.”



“EBS are the Mortgage Masters and our experts are on hand to help people achieve their dream of home ownership.”



The offer of 2% back in cash is available to customers taking out fixed or variable rate mortgages on Private Dwelling Houses, including first time buyers, customers moving to a new home, and customers who wish to switch their mortgage to EBS.

Fixed rate changes come into effect on 10thOctober 2017.



*If an existing customer is already on a fixed rate and wants to avail of the new rates an early breakage cost may apply.

 

[Brendan Burgess]

 

[Brendan Burgess]

If this is correct, then EBS is catapulted back to the top of the Best Buys tables for mortgages over €150k

3.15% + 2% cash back compared to BoI's 3.35% + 2% cash back (or 3% if you stay more than 5 years.)

Or KBC for switchers:- 2.9% + €3,000 cash back

Brendan

 

[Funnyname]

Just in the middle of transferring our mortgage to EBS, very disappointed not to see the variable rate fall.

I can't see any easily got info online, but wondering if we sign up to a fixed period does anyone know what rate the mortgage would return to at the end of the fixed period. If it's the variable rate then I'd be inclined to go for the fixed rate, I can't see anything on their site about an SVR once you come off the fixed period.

Also I'll ask this here, is there a minimum period we have to wait before transferring the mortgage to another provider as it might actually be cheaper to go to say KBC or BoI once we change over to EBS if we din't fix with them?

 

[pauric]

Fantastic news, I just switched this month from BOI to ESB specifically for the 2% cash back and opted for the SVR as it and fixed rate were the same price anyway. I got BOI 16 months ago with 2% cashback on a 1 year fixed back then so will switch to a 1 year fixed now as I just moved jobs and won't be able to switch again for another year anyway.

 

[RedOnion]

I think this move, more than any other to date, could escalate the drop in rates in the market.

To date, the main lenders have been avoiding competing on directly comparable products; generalising here, AIB had the best variable rates, BoI had best short term fixed rates with cashback, UB had carefully targeted rates, and KBC had introduced longer term rates.
Through EBS, AIB are targeting BOI's target market. Expect a big response from BoI to protect market share.

Another important point here, unless I've missed something, is EBS have ended the tiered rates between existing and new business? If that's the case, there is no reason for anyone on SVR with EBS not to switch to fixed.

And finally, it makes a mockery of the whole idea of a variable rate policy statement!

 

[Showmethemoney]

I've just started a one year fixed rate at 3.5%. I'd better enquire about early breakage costs.

 

[Sarenco]

Expect a big response from BoI to protect market share.

BOI made their last move back in June so it will be interesting to see how long they take to re-act to the latest EBS move.

 

[Paul Reilly]

Isnt typical Variable rate not changed.

Theres something inherently wrong about this.

 

[Sarenco]

Theres something inherently wrong about this.

What do you think is inherently wrong about lenders choosing to compete on this basis?

 

[Paul Reilly]

That all rates are decreasing but Variables are being kept high to fund the banks

 

[Sarenco]

That all rates are decreasing but Variables are being kept high to fund the banks

I see. In that case why don't borrowers fix?

 

[Boyd]

Also I'll ask this here, is there a minimum period we have to wait before transferring the mortgage to another provider as it might actually be cheaper to go to say KBC or BoI once we change over to EBS if we din't fix with them?

AIB told me last week they will consider all cases, you can switch at any stage. You don't need to wait 12 months. Other banks may not be this flexible though.

 

[Dauhee]

AIB certainly considered my case, but computer say no

 

[RedOnion]

UB I July told their brokers that they are now considering switchers after just 6 months.

 

[skrooge]

UB I July told their brokers that they are now considering switchers after just 6 months.

Interesting, I'm a a wet week into an EBS mortgage (variable). Motivation was the 2% cashback. The intention is to cut and run as soon as I can (or more to the point as soon as someone better will have me).

I was working on the assumption that no one else would touch me for a year so after the reduciton in fixed rates was considering fixing that part of the mortgage I'm unlikely to pay off in year one (i.e., most of it!) for the year. Seemed to be a no brainer if I cant move for 12 months then make it as cheap as I can with EBS.

However, if banks are moving towards quicker assessments of switching then my options might not be as clear cut as I thought.... I had every intention of checking this with KBC yesterday morning but unfortunately their hub was closed at the time.

 

[RedOnion]

Interesting, I'm a a wet week into an EBS mortgage (variable). Motivation was the 2% cashback. The intention is to cut and run as soon as I can (or more to the point as soon as someone better will have me).

I was working on the assumption that no one else would touch me for a year so after the reduciton in fixed rates was considering fixing that part of the mortgage I'm unlikely to pay off in year one (i.e., most of it!) for the year. Seemed to be a no brainer if I cant move for 12 months then make it as cheap as I can with EBS.

However, if banks are moving towards quicker assessments of switching then my options might not be as clear cut as I thought.... I had every intention of checking this with KBC yesterday morning but unfortunately their hub was closed at the time.

We'll, there's such a gap between their variable and fixed rates now, that it should be worth fixing even if you intend to be gone in 6 months. There might be a break fee, but interbank interest rates would have to fall significantly to out weigh the interest rate savings.

 

[Itchy]

Mentioned this in another thread but BOI told me they will consider a switch after 6 months and PTSB said after 12 months.

 

[brenbiz]

Currently have a 190k mortgage with EBS on SVR 3.7% - in negative equity so that rules out a switcher mortgage for me :-( (house value currently 160k)
Any advice on the new EBS 3 year 3.15 and 5 year 3.25 fixed rates - should I consider switching to of these or is there hope that the SVR will drop below 3% in the next 3-5 years?