Mortgage rate 'war'

Discussion in 'The Fair Mortgage Rates Campaign' started by dave2015, 12 Dec 2017.

  1. renter45

    renter45 Frequent Poster

    Posts:
    80
    TheJackal and RedOnion like this.
  2. RedOnion

    RedOnion Frequent Poster

    Posts:
    2,061
    I suspect it's just UB rolling their rates for another 6 months. They're slightly unusual in that a 2 year fixed for example isn't for 2 years, but up to 2.5 years depending on when you draw down (fixed until Sept 2020). They were previously quoting to March, so had to update the rate sheet.
     
  3. TheJackal

    TheJackal Frequent Poster

    Posts:
    199
    Cheers. I've been waiting for the new rates. Thought they'd drop the variable rate.

    For a <50% LTV
    AIB doing 2.75% +2K cash back
    UB doing 3.2% (under 200K mortgage) or 3.0% (over 300K) +1.5K

    Seems to me this mortgage rate war has stalled last few months
     
  4. gnf_ireland

    gnf_ireland Frequent Poster

    Posts:
    1,291
    I would be 99% sure that is because of IT system limitations rather than trying to be a 'differentiator' by design :)

    Definitely - and I imagine it will be the case until the full assessment has been done on the tracker scandal

    And AIB is still losing market share !
     
  5. RedOnion

    RedOnion Frequent Poster

    Posts:
    2,061
    Only 99%? ;)
     
  6. gnf_ireland

    gnf_ireland Frequent Poster

    Posts:
    1,291
    Having never worked for them I could not say 100%

    But that said, I have seem strange requirements and product designs over the years just because that's the way someone defined it 10 years previously and they have never bothered to change it... or its too hard to update the process material or training material !
     
  7. dave2015

    dave2015 Registered User

    Posts:
    40
    Would there be anything to stop switching for the 4year fixed ending march 2022 to new one ending sept 2022 on assumption little or no break fee? Few more months at 2.6 couldn't hurt!
     
  8. newirishman

    newirishman Frequent Poster

    Posts:
    748
    Exactly what I was thinking. I'll call them tomorrow and will report back....
     
    RedOnion likes this.
  9. pauric

    pauric Frequent Poster

    Posts:
    61
    Was hoping they would have attacked the 10 year market more. Need some more competition there to try and bring those rates down. Worries that exiting their 4 year and possibility rates could have gone up a % or so.
     
  10. gnf_ireland

    gnf_ireland Frequent Poster

    Posts:
    1,291
    I have to agree here - this is an area that definitely should be looked at by the banks. I would have liked to see more sub 3% 10 year fixed rates, especially since ECB are starting to talk about raising rates.

    Its interesting to see KBC's pricing for 10 year fixed products - <50% LTV = 2.95%; 50-60% = 2.95%; 60-80% = 2.99%; 80-90% = 3.5%
    So they only add a premium of 0.04% for LTV of a 30%+ margin - so 49% to 79%. I would have expected that to be higher if I am being honest

    I think the customers with lower LTV are the ones losing out in all of these discussions. The rates for the higher LTV's are not off the scale considering our current conditions, especially how difficult and costly it is to enforce security on the mortgage.


    I wonder would any bank be willing to target 'blue chip' lending at lower rates - so <15 years left, Max 2 times LTI (based on last 3 years pay slips) and less than 50% LTV and offer them a 2% rate on it. And instead of a cashback request 500 euro arrangement fee.... would that shake up the switcher market any bit? I personally think it would need something like that to trigger a proper 'war' at the lower LTV levels.
     
  11. dave2015

    dave2015 Registered User

    Posts:
    40
    For info got confirmation of zero break fee and option to pick the new 2.6% deal ending sept 2022. So means effectively got 5 year fixed at that rate now.
     
  12. TheJackal

    TheJackal Frequent Poster

    Posts:
    199
    Has any bank dropped their variable rate last 6 months or so? It seems just the fixed rates dropping lately
     
  13. renter45

    renter45 Frequent Poster

    Posts:
    80
    Think the last bank to amend variable was AIB and that was 6+ months ago. Nothing much changed since November, other then Ulster bank and KBC tweaking rates. Nothing from BOI, AIB, EBS, PTSB this quarter.
     
  14. skrooge

    skrooge Frequent Poster

    Posts:
    162
    Doubt there will be much movement in variable rates. For a number of reasons:

    Over half of new lending is fixed these days. People are preparing for eventual rate increase.

    New lending/switching while increasing is still quite low. Coupled with that demand for housing is outstripping supply. With so few players in the market cutting rates won't lead to significant new levels of lending for any bank.

    With all that a drop in variable rates would disproportionately hit banks existing book (which is still mostly variable). Net effect less money for banks.
     
  15. Sarenco

    Sarenco Frequent Poster

    Posts:
    5,178
    That's not universally the case. For example, over 75% of BOI's back book consists of trackers and fixed-rate mortgage products.

    AIB has the lowest variable rates on the market but that's not much use if other lenders are offering lower (effective) fixed rates. If AIB want to maintain market share with their current variable rate strategy, then they're going to have to lower their rates IMO.

    Mind you, AIB has spent a fortune on advertising recently so maybe they are hoping that will do the trick and that potential borrowers aren't much good at maths!
     
  16. skrooge

    skrooge Frequent Poster

    Posts:
    162
    Fair point on BOI but they got there by deliberately pricing themselves out of the variable rate market.It would be a major about turn for them to change that now.

    As for AIB if they were to react to lower fixed rates in the market I would imagine it would be through EBS. Use one brand for fixed other brand for variable. Direct conpetion is very limited.

    In saying all that I think I read somewhere on here how ptsb still have a sizeable market share of new lending and they are not at the sharp end of the market on any front. People on here are not representative of the whole market. It's a seller's market in terms of mortgages. Banks will get the business regardless.
     
  17. Anonymy

    Anonymy Registered User

    Posts:
    10
    I can’t post the link here as I have not got enough posts but PTSB have reduced their rates if someone could please post the article!

    Still high but maybe EBS will reduce their fixed rates more as a result of this! UB’s four year fixed at 2.6% still seems the best to me!
     
  18. Sarenco

    Sarenco Frequent Poster

    Posts:
    5,178
  19. Sarenco

    Sarenco Frequent Poster

    Posts:
    5,178
  20. RedOnion

    RedOnion Frequent Poster

    Posts:
    2,061
    Itchy and Dauhee like this.