AIB, EBS and Haven Rate Reductions

Senna

he standard variable and Loan to Value rate reductions will apply to mortgages from AIB, EBS and Haven and will be available to new and existing customers.

The cut will see the bank’s standard variable rate fall to 4.15% from 1 December, with the EBS rate dropping to 4.33% and Haven's falling to 4.35%.

Meanwhile, Loan to Value rates at AIB and Haven will fall by 0.24%, with EBS rates falling by 0.25%.


A five-year fixed rate at any of the three lenders within the AIB Group will fall to 3.9%, from a previous level of 5.2%.

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http://www.rte.ie/news/business/2014/1030/655873-aib-mortgage-rates/

Good news and really unexpected.
The 5 year fixed rate of 3.9% is really tempting me at the moment, would anyone know are they expecting rates to drop? and maybe 3.9% isn't a good rate?

mickman

That definitely seems to be the way. Having a 5 year fixed cheaper than the variable won't last

Gerlad

I was on the 4.49%, reduced to 4.25%. Tempted to lock in on the 3.8% fixed one for 2 years. Is it based on a certain LTV?

GKiraly

being on standard variable, I'm tempted to snap up one of the fixed rates, but somehow I've got a funny feeling about all this!!! 5 year fixed is 3.9% - down by 1.3% - while the variable im on is 4.15, how the hell is a 5 year fixed so much better than the variable?!?!?!?!? is this indicating that the variable is about to fall further???

jameshayes

some good info here;http://www.askaboutmoney.com/showthread.php?t=190045

mickman

jameshayes wrote: »

some good info here;http://www.askaboutmoney.com/showthread.php?t=190045

Yes

GKiraly

Brendan Burgess sums up pretty much what im also thinking on this!....

It's very odd that AIB has a fixed rate lower than their SVR. This suggests that they expect rates to fall further.

but here are what i believe the key points and watchouts in all this, and why right now I could be tempted by the 3.8%, if even just for 2 years, coz it would take another two cuts in that time to negate the benefits of it......which isnt unlikely, but still a reasonably healthy option......

The ECB rate is 0.15% at present. It seems to me that the 4.5% rate is too high for this ECB rate. It may attract new entrants into the market, so while the ECB rate is unlikely to fall much further, maybe the banks will be forced by competition to bring down their variable rates.

It's very hard to know. When the world economies return to normal, the ECB rate should probably be around 3% or 4%. If the current margins were maintained, that would imply mortgage rates of 8%/ 8.5%.

8% / 8.5% ? ? ? :eek:

....this could sort that problem for a while:

As rates are not expected to rise in the short term, I see little point in fixing for one or two years, but what about a 5 year or 10 year fix?

and that link that JamesHayes has provided has some very good stuff on it, thats where i got the info above, food for thought!!