Fixed 4.75 should i go Variable

T

Tony

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just got our repayment forms this morning and we decided to go fixed the rate we are getting is 4.75 fixed over 2 years, the variable rate is 3.75 what are the chances of the variable rate reaching 4.75 and above, should i change it back to variable?
 
Why are you fixing? What lender? A variable rate of 3.75% is not exactly competitive either. Did you shop around for the best deal? See the Financial Best Buys list. See this thread and the many others about fixed versus tracker/variable rates.

Post crossed with elcato's.
 
Tony said:
done, honestly its like being in school sometimes with this forum
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Please stick to the point and adhere to the posting guidelines. If you don't like the way things operate around here then find another forum that meets your needs better.
 
i know, will be sure to do it in the future

we have a kind of awkward situation and we tried i think every bank in the country and ebs were the only ones who could offer us money. TBH the only reason we are fixing is because of all the scare tactics at the moment around rising interest rates. i was all along going to fix but then i am thinking with a variable rate of 3.75 and a fixed of 4.75 i could be paying fixed for 2 years and the variable rate might never reach 4.75 (or what are the chances of it happening). also am i right in thinking that the tax rebate for a single person is €66 or is this incorrect
 
Tony said:
we have a kind of awkward situation and we tried i think every bank in the country and ebs were the only ones who could offer us money.
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Any particular reason other lenders would not entertain you? EBS also have an ECB + 1.25% tracker which is the same rate as the standard variable but at least guarantees the margin. See [broken link removed]. Some people have also haggled with EBS to get better (tracker) rates. No harm in asking but it helps if the don't know that they are the only lender that will deal with you.
TBH the only reason we are fixing is because of all the scare tactics at the moment around rising interest rates. i was all along going to fix but then i am thinking with a variable rate of 3.75 and a fixed of 4.75 i could be paying fixed for 2 years and the variable rate might never reach 4.75 (or what are the chances of it happening).
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If you can afford repayments based on rates increasing by a few percent then there is most likely no real need to fix. If your cashflow was such that this would leave you in an awkward position with regard to the repayments then you might need to fix. Fixing primarily to save money over a competitive tracker/variable rate is generally not a good idea and will generally not save you anything - in fact you will generally pay more for the peace of mind that fixed repayments bring. Also fixed rates are inflexible in that you generally can't make lump sum capital repayments, vary your repayments or switch mortgages without paying fixed rate breakage penalties. Only fix if you really need to.
also am i right in thinking that the tax rebate for a single person is €66 or is this incorrect
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Yes. A FTB in the first 7 years of the mortgage on their first PPR qualifies for standard rated mortgage interest tax relief on up to €4K in interest. €4,000 @ 20% / 12 months = €66.67 p.m. Joint owner occupier buyers each obtain mortgage interest tax relief. To be classified as FTBs jointly each individual must be a FTB. You can apply for this relief [broken link removed].
 
tracker vs standard variable

Which is better?

I would apprciate if some would give me a simple answer to this as some of the threads do not work.
 
cerberos said:
Which is better?

I would apprciate if some would give me a simple answer to this as some of the threads do not work.
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If you want to know your repayments with certainty, go with a fixed mortgage. If you are willing and able to live with the interest rate cycle, go for tracker/variable. Simple enough?
 
thx for the quick reply CC.
However, its tracker vs standard I am a bit confused about.

A standard also tracks the ECB rate?

So if I go with a tracker of ECB +.5 ECB + .9, how does this differ from the standard rate?
I understand that the _ bit remains constant while the ECB rate changes but how does it differ from the standard rate which must also relate to the ECB rate.
The only difference I can see it the time delay for the Bank to apply a new repayment rate as the ECB rate changes.

x 4 Masters
 
A tracker has a fixed margin and will track any rate moves.

The variable rate moves at the lender's discretion, and the margin is not fixed.

I may have heard something recently about a particular lender not passing on recent rate hikes to their variable rate customers, but I can't back that up with evidence.

The tracker vs. variable issue was discussed at some lenghth previously I feel, maybe I can find a link.
 
Maybe I'm blind but where did you find it cerberos?

Reply with a link if possible.

cheers in advance
 
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