10 year Rates

Paddytheman

Sale agreed and progressing nicely with our potential purchase and now KBC have offered a 10yr fixed rate which is nearly a full % better than the nearest competitor.

Obviously a crystal ball would be handy but does anyone have any knowledge reagrding this. Banks dont give stuff away for nothing but the security of knowing your repayments for 10years would be great for life planning.

Is this a way of securing their customers from switching providers or are they expecting a drop in rates?

Appreciate any insight.

listermint

All of the above.

Its is about them securing customers

Its also good for you securing your repayments.

There is no right answer. Could be a better deal around the corner also equally there may not be.

If it makes sense to you financially and are happy with repayments then go for it. Examine break clauses to see if they are overtly punishing though as maybe you would want to break after some years.

yosser hughes

FWIW I think interest rates will rise in the coming years.

With regard to KBC's offer,there will be two rates available:
The 2.95pc rate applies to those whose property is worth at least 40pc more than the mortgage owed on it - they have an LTV of 60pc or less. For those with at least 20pc equity in the property, or an LTV of 80pc or less, the rate on the 10-year fixed is 2.99pc.
The rates include a mortgage discount of 0.2pc for customers who have a current account with KBC.

flashforward

yosser hughes wrote: »

FWIW I think interest rates will rise in the coming years.

With regard to KBC's offer,there will be two rates available:
The 2.95pc rate applies to those whose property is worth at least 40pc more than the mortgage owed on it - they have an LTV of 60pc or less. For those with at least 20pc equity in the property, or an LTV of 80pc or less, the rate on the 10-year fixed is 2.99pc.
The rates include a mortgage discount of 0.2pc for customers who have a current account with KBC.

Sounds like a great rate and deal.
Will the other banks retaliate? For them to offer this they must be expecting the rates to drop significantly for this to make sense...

AlmightyCushion

yosser hughes wrote: »

FWIW I think interest rates will rise in the coming years.

With regard to KBC's offer,there will be two rates available:
The 2.95pc rate applies to those whose property is worth at least 40pc more than the mortgage owed on it - they have an LTV of 60pc or less. For those with at least 20pc equity in the property, or an LTV of 80pc or less, the rate on the 10-year fixed is 2.99pc.
The rates include a mortgage discount of 0.2pc for customers who have a current account with KBC.

Whoever wrote that article you're quoting needs to learn how to multiply percentages.

al_E_kat

Myself and my OH are about 15 months into our mortgage and I decided to look at switching to KBC. We're in the middle of the process atm with a broker and this was announced and we've decided to go for it but the broker was less than keen (I suppose that's because he can forget about business from us for the next 10 years)

Anyway here are a few reasons we decided to take it on if it helps anybody making this decision, one way or the other.

Firstly there was the argument of what's in it for the bank, seems to good to be true, does that mean they expect a drop in rates etc. Although a drop may come 10 years is long enough to see both rise and falls so knowing what our repayments will be is a great comfort and 2.99% is a good rate. I looked up national averages of mortgage rates over the past 20 years and Google gave me a list, the lowest of which was 3.89% in 2012 I think. Now I know that means there were plenty on lower rates than that cos it's an average but I'm assuming low tracker rates is what brought that down, something we are not eligible for.

If they do fall and we miss out on an amazing rate that is something we'll just have to accept as the gamble we didn't take. The repayments at this rate are very manageable for us that if my partner lost his job I could sustain us......albeit we'd have to tighten our belts but it's doable (he's private sector I'm public)


For the next ten years we don't have to worry about switching again to try get out of a higher rate and have our bank details scrutinised, we're not stupid but it's nice to not have to worry about every bank transaction. If we needed a loan for say a car payment or home improvements we could access that and have it fully repaid before the fixed term is even up. We've recently had our house valued also and it has increased since our purchase in 2016 so for 10 years we don't have to worry as much about negative equity either, but obviously we'll remain mindful about it.

There just our reasons when we laid it all out on the table, personally (and I'm certainly no expert) I'd echo what others have said here that I'd see a rise in rates on the table and knowing this won't be a worry of ours for the next decade is a comfort I have to say. Hope this helps anybody considering their options

Edit to add: by switching we're going from a 4.2% to 2.99% so we're getting a win right at the beginning which is nice!

mugsymugsy

al_E_kat wrote: »

Myself and my OH are about 15 months into our mortgage and I decided to look at switching to KBC. We're in the middle of the process atm with a broker and this was announced and we've decided to go for it but the broker was less than keen (I suppose that's because he can forget about business from us for the next 10 years)

Anyway here are a few reasons we decided to take it on if it helps anybody making this decision, one way or the other.

Firstly there was the argument of what's in it for the bank, seems to good to be true, does that mean they expect a drop in rates etc. Although a drop may come 10 years is long enough to see both rise and falls so knowing what our repayments will be is a great comfort and 2.99% is a good rate. I looked up national averages of mortgage rates over the past 20 years and Google gave me a list, the lowest of which was 3.89% in 2012 I think. Now I know that means there were plenty on lower rates than that cos it's an average but I'm assuming low tracker rates is what brought that down, something we are not eligible for.

If they do fall and we miss out on an amazing rate that is something we'll just have to accept as the gamble we didn't take. The repayments at this rate are very manageable for us that if my partner lost his job I could sustain us......albeit we'd have to tighten our belts but it's doable (he's private sector I'm public)


For the next ten years we don't have to worry about switching again to try get out of a higher rate and have our bank details scrutinised, we're not stupid but it's nice to not have to worry about every bank transaction. If we needed a loan for say a car payment or home improvements we could access that and have it fully repaid before the fixed term is even up. We've recently had our house valued also and it has increased since our purchase in 2016 so for 10 years we don't have to worry as much about negative equity either, but obviously we'll remain mindful about it.

There just our reasons when we laid it all out on the table, personally (and I'm certainly no expert) I'd echo what others have said here that I'd see a rise in rates on the table and knowing this won't be a worry of ours for the next decade is a comfort I have to say. Hope this helps anybody considering their options

Edit to add: by switching we're going from a 4.2% to 2.99% so we're getting a win right at the beginning which is nice!

Are you on a variable or fixed?

al_E_kat

mugsymugsy wrote: »

al_E_kat wrote: »

Myself and my OH are about 15 months into our mortgage and I decided to look at switching to KBC. We're in the middle of the process atm with a broker and this was announced and we've decided to go for it but the broker was less than keen (I suppose that's because he can forget about business from us for the next 10 years)

Anyway here are a few reasons we decided to take it on if it helps anybody making this decision, one way or the other.

Firstly there was the argument of what's in it for the bank, seems to good to be true, does that mean they expect a drop in rates etc. Although a drop may come 10 years is long enough to see both rise and falls so knowing what our repayments will be is a great comfort and 2.99% is a good rate. I looked up national averages of mortgage rates over the past 20 years and Google gave me a list, the lowest of which was 3.89% in 2012 I think. Now I know that means there were plenty on lower rates than that cos it's an average but I'm assuming low tracker rates is what brought that down, something we are not eligible for.

If they do fall and we miss out on an amazing rate that is something we'll just have to accept as the gamble we didn't take. The repayments at this rate are very manageable for us that if my partner lost his job I could sustain us......albeit we'd have to tighten our belts but it's doable (he's private sector I'm public)


For the next ten years we don't have to worry about switching again to try get out of a higher rate and have our bank details scrutinised, we're not stupid but it's nice to not have to worry about every bank transaction. If we needed a loan for say a car payment or home improvements we could access that and have it fully repaid before the fixed term is even up. We've recently had our house valued also and it has increased since our purchase in 2016 so for 10 years we don't have to worry as much about negative equity either, but obviously we'll remain mindful about it.

There just our reasons when we laid it all out on the table, personally (and I'm certainly no expert) I'd echo what others have said here that I'd see a rise in rates on the table and knowing this won't be a worry of ours for the next decade is a comfort I have to say. Hope this helps anybody considering their options

Edit to add: by switching we're going from a 4.2% to 2.99% so we're getting a win right at the beginning which is nice!

Are you on a variable or fixed?

Variable at the moment switching from PTSB

Wesser

I am thinking of going with Ulster bank 4 y fixed at 2.6 % Is this a good option?

I understand that rates could fall lower than that and im not expecti g anyine to have a crystal ball.

but I just want reassurance that this is a good option or should I go for one if those fancy BOI cash back deals?

al_E_kat

Wesser wrote: »

I am thinking of going with Ulster bank 4 y fixed at 2.6 % Is this a good option?

I understand that rates could fall lower than that and im not expecti g anyine to have a crystal ball.

but I just want reassurance that this is a good option or should I go for one if those fancy BOI cash back deals?

Seems like a goid rate to me from hust looking at whats out there but again no expert.

We were originally going with a 3 year fixed before the 10 year announcememt and I must admit I was afraid we could come out of it at a bad time. Again no expert but our recent valuation just brought us within the 80% ltv so I was worried prices could dip and we’d go back on a higher rate as a result.

We are also getting a 3k cash back deal with this move, so switching is costing us nothing as this will cover legal fees with money left over

Paddytheman

Yer man Karl Dieter on Today Fm was talking 10yr fixed rates yesterday, basically said that whereas now Eurpoean interest rates are considerably lower than ours those 3% fixed rates could well match the European average in a few years, fairly positive.

Askthe EA

yosser hughes wrote: »

FWIW I think interest rates will rise in the coming years.

.

Obviously the banks dont (or at least dont think they'll rise much)

Graham

Askthe EA wrote: »

Obviously the banks dont (or at least dont think they'll rise much)

That's not necessarily the case.

The bank may have secured funds at a set rate over a 10 year period to underwrite these mortgages. Offering these funds to the public on similar terms gives the bank fairly secure returns over the 10 year term.

morrga

Paddytheman wrote: »

Sale agreed and progressing nicely with our potential purchase and now KBC have offered a 10yr fixed rate which is nearly a full % better than the nearest competitor.

Obviously a crystal ball would be handy but does anyone have any knowledge reagrding this. Banks dont give stuff away for nothing but the security of knowing your repayments for 10years would be great for life planning.

Is this a way of securing their customers from switching providers or are they expecting a drop in rates?

Appreciate any insight.

Rate rises are going no where. Banks bet on what way the rate will go so offer the opposite to what they think the market will do. My bet is KBC are betting on the interest rates further declining so they can profit on people fixed in for 10 years. Think about it. Banks get you to do what they want not what is better for you.

People need to realise interest rates are going no where long term whilst we have such a fragmented EU zone where France and Germany have to consider the well being of smaller nations before they can consider their own vested interests toward rate rises and inflation.

Think of a bank as a bookmaker. They are there to make money from us not facilitate us. I would be inclined to fix for 3 years and see where the market is then which in my opinion is heading towards 2-2.5% mortgages.

Japan has been in long term low interest rate mode. The EU is set for something similar and people should start coming around to that theory. After all we just a state in a large country now.

al_E_kat

I just got a letter in the post from PTSB encouraging me to explore my options as they ‘value my custom’. I’m entitled to a rate drop, subject to a valuation. I could go as low as 4% with them lol