Finance Ireland raise interest rates from 1.5-2% (Oct 2022)

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smndly

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https://www.rte.ie/news/business/2022/1003/1326804-finance-ireland-rate-increases/

Large increase in interest rates from Finance Ireland today.

Non-bank lender Finance Ireland said it will raise its variable and fixed rates for its mortgage products by between 1.5% and 2%.
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After the rate increase, Finance Ireland said its 20-year fixed rate mortgage will be priced from 4.6% to 5% depending on the loan-to-value percentage band.
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Also some very bad news for those in the process of drawing down with them as they will need to be drawn down by this Friday to avail of the current rates.

Mortgage applications which have been approved and which are drawn down before close of business on Friday of this week will continue to avail of existing rates, it added.
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Interesting how the non bank lenders have all raised rates recently which is in contrast to AIB/BOI/PTSB
 
We were approved and signed all legal docs. They are saying that everything wasn't in order by Friday last and have withdrawn their offer. I also infer from their language that they will have to draft a new loan offer based on the new rates (which i assume means a whole new set of stress tests etc). It would appear to be totally disingenuous and in conflict with their public statements yesterday. Needless to say that won't be the last they hear from me
 
But if the mainline banks have deposits for free why not lend them in the intermarket for 3% at a profit?
I believe Finance Ireland basically packaged and sold alot of loans to BOI who likely have withdrawn interest in underwriting at 3% as theres no profit in it.
 
lomber said:
I believe Finance Ireland basically packaged and sold alot of loans to BOI who likely have withdrawn interest in underwriting at 3% as theres no profit in it.
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Are you saying that BOI aren't lending?
 
Im saying they are about to close up shop at the 2 -3.3%
Boi may be a bit deceptive with the cash back and higher rates than other lenders – but the high short rates and low long rates forced many into long fixes so thats one good thing they did versus the likes of Aib. They are still 3.3 for 10 years with cashback.
Really there have been long term low emergency rates for around 14 years and I think the central banks will be wary of ever zeroing the rate again.
 
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Paul F said:
Are you saying that BOI aren't lending?
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It doesn't make any rational sense for BOI to sell mortgages at the current market rates. There are plenty less risky ways for the bank to generate returns in the markets right now.
 
We were the exact same paulex. We've signed all of legal documents and returned them but because we didn't have the letter for drawdown in by last Friday they've pulled out. We were in the process of chatting to the solicitor on Monday about it when we heard about the rate increase. I'm absolutely devastated.
 
Finance Ireland have updated their tables of rates on their website:

Mortgage Rates | Irelands largest non-bank lender. .

Irelands largest non-bank lender. We are an Irish financial services provider established in 2002. We operate in various sectors, including commercial property lending, residential mortgages, motor finance, asset-backed lending and agri-finance.
www.financeireland.ie
 
Their variable BTL rates range from 6.4% to 6.8% variable now plus for existing customers.

Even on very high-yielding properties it's hard to make the sums add up on those rates.
 
On 50% Ltv that most BTL are there is no reason to be above 2.8 wholesale for a 10 year or Euribor(1.2 for 3 month+1.5 margin for variable+ a small liquidity margin) Anything else is approaching money lender rates.
The tenants must suffer, but hey I guess thats Ireland!
 
lomber said:
Anything else is approaching money lender rates.
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It really is

New, floating rate unsecured lending to households varies between 7.7% and 8.2% this year according to the Central Bank. This home renovation loans from banks, credit unions, car finance, overdrafts, etc.

It's astonishing that secured lending is less than 200bps below. Even BoI have a variable BTL rate of 4.8%.

I'm not sure what the government can do (if anything) in this regard but at these rates even Ireland's very high rental yields just make no sense to a prospective landlord paying 52% at the margin.
 
@paulex @BeccaF10! I don't know if you are first-time buyers or home movers, but if you still have time to apply to other lenders have a look at these threads for info on the lowest mortgage rates available:

Key Post - First Time Buyer mortgage guide

Some tips and Frequently Asked Questions when applying for a mortgage as a first-time buyer (FTB)... Start by getting mortgage approval from the lender you bank with If you have your current account with Bank of Ireland, then apply directly to them for a mortgage. Assuming you have a good...
www.askaboutmoney.com

Best Buy - Which lenders have the lowest mortgage rates? (Updated April 2023)

While I wrote the original post on this, Paul F has edited it and made it far easier to read and has kept it updated. Brendan You (or your broker) should apply to two or three of the cheapest lenders simultaneously. It might take some time for your loan offer to materialise, and today's Best...
www.askaboutmoney.com

(Look at both threads even if you are a first-time buyer.)

If you were in the process of switching your mortgage to Finance Ireland, consider posting your mortgage details in the switcher thread.
 


Paulex and BeccaF10!, Finance Ireland have been very slow in processing applications for months now, so thousands of people are being hit with the higher rates, because of Finance Ireland's own delays and are the same boat as yourselves.

While technically the small print in the loan offers allows them to do this, this undermines confidence in lenders across the industry and is very short sighted. People won't start switching or buying if they don't have some certainty around rates and decent approval times. I spoke to Charlie Weston about this yesterday in the Indo article below,

Finance Ireland Irish Independent Article

Hopefully sense prevails in for mortgages at the very final stages. I'd encourage anyone impacted to make a complaint to the financial services ombudsman here, even if you don't get the old rate back you may help this happening to others in future.
 
@Mark Coan

Hi Mark

In the old days, I thought it was very clear. The fixed rate was determined on the day you drew down the mortgage. Not the rate in the letter of offer.

And people benefited from this when rates fell although they lost out when rates rose.

So I am not sure that it's worthy of a complaint to the Ombudsman?

If a lender such as Avant or AIB said that they would turn around letters of offer within 7 days of getting all the information and that the rate would be guaranteed for 30 days or 60 days, it would be a great marketing advantage for them.

Maybe some of them have this already in the letter?

Brendan
 
What has frustrated me is that we had everything into them already, we were literally just waiting for them to say go ahead.I contacted them last Wednesday and they advised me that they were still reviewing it, even though they were just waiting previously for one bit of info which was provided to them at the beginning of September. I just wish they would have told me to get the solicitor to request drawdown while we were waiting. Now we're paying solicitor fees for the work that he has already done and we have no mortgage.
 
You should always apply to multiple lenders simultaneously. You have the documents ready so it costs nothing to submit the paperwork to and see who has the best rates available when you actually want to draw down.
 
NoRegretsCoyote said:
First you have to complain to the lender.

If the complaint is rejected you have to have an appeal by the lender rejected or ignored.

Otherwise the FSPO won't entertain your claim.
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That's a very good point, if anyone has any success with Finance Ireland it would be great if they post here for others to see, if not making a complaint to the FSPO may yield some fruit.
 
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