Mortgage rate

masterboy123

I got a good offer of 2.6% fixed rate for 4 year, from Ulster bank. But it says after 4 years, a 4.3% SVR (standard variable rate) applies, which seems to be very high. I wonder if anyone has experience whether SVR is an approximate rate based on current market?
And is there usually a fee if I move to another bank after 4 years?

This mortgage game is getting tough day by day!

Thanks and have a good weekend

joebloggs32

masterboy123 wrote: »

I got a good offer of 2.6% fixed rate for 4 year, from Ulster bank. But it says after 4 years, a 4.3% SVR (standard variable rate) applies, which seems to be very high. I wonder if anyone has experience whether SVR is an approximate rate based on current market?
And is there usually a fee if I move to another bank after 4 years?

This mortgage game is getting tough day by day!

Thanks and have a good weekend

That SVR is what currently applies. It may rise or fall between now and then. When your fixed rate is up you will be able to fix again but rates may be different in 4 years time. The ECB rate will most likely be higher by then so assume it will be.

masterboy123

masterboy123 wrote: »

I got a good offer of 2.6% fixed rate for 4 year, from Ulster bank. But it says after 4 years, a 4.3% SVR (standard variable rate) applies, which seems to be very high. I wonder if anyone has experience whether SVR is an approximate rate based on current market?
And is there usually a fee if I move to another bank after 4 years?

This mortgage game is getting tough day by day!

Thanks and have a good weekend

It does cost to change mortgage provider, you need to get your solicitor involved again so there are legal fees.

But after the 4 years you can just fix again. You're not stuck on the variable rate.

masterboy123

Thank you.

Will it cost again 1500 euros to pay to solicitor if there is a need to change mortgage provider.

And if the last 10 years, has mortgage rate ever been so high that it reached 4.5%??

Joe Ripe Face wrote: »

It does cost to change mortgage provider, you need to get your solicitor involved again so there are legal fees.

But after the 4 years you can just fix again. You're not stuck on the variable rate.

masterboy123

masterboy123 wrote: »

Thank you.

Will it cost again 1500 euros to pay to solicitor if there is a need to change mortgage provider.

And if the last 10 years, has mortgage rate ever been so high that it reached 4.5%??

Yeah it might cost that.

I will just reiterate that after the 4 years you can just take whatever fixed rate UB are offering at that time, which will be much lower than 4.5%

masterboy123

Well, it says SVR will be 4.2% (which looks high for me) after 4 years fixed period. It also says it will not be same as ECB.

However, AIB is giving 2.9% variable rate.

Which deal is better overall?

Joe Ripe Face wrote: »

Yeah it might cost that.

I will just reiterate that after the 4 years you can just take whatever fixed rate UB are offering at that time, which will be much lower than 4.5%

What Username Guidelines

masterboy123 wrote: »

Well, it says SVR will be 4.2% (which looks high for me) after 4 years fixed period. It also says it will not be same as ECB.

However, AIB is giving 2.9% variable rate.

Which deal is better overall?

You’re better off completely ignoring the variable, it could be anything in 4 years time. In my opinion the 2.6 fixed is better, as the AIB 2.9 could also change at any stage. Fixing usually gives peace of mind and in 4 years time you can shop for the best deal then.

Switching will cost money, but often the cost can be absorbed in potential saving, and/or banks offer incentives. In my situation I moved from a 4.3 to 2.95var and saved 250 a month. And the mortgage isn’t even that big. At the time, they were giving €2,000 cash back, and my solicitors fees were just under €1,200.

Obviously you cannot predict the incentives either, but people often shy away from shopping around and switching, due to the potential cost. It’s a bit of a pain to do with statements, etc, but certainly worth it.

masterboy123

masterboy123 wrote: »

Well, it says SVR will be 4.2% (which looks high for me) after 4 years fixed period. It also says it will not be same as ECB.

However, AIB is giving 2.9% variable rate.

Which deal is better overall?

Please, you're not acknowledging what people are telling you. You don't ever have to go on the variable rate. If you are on a variable rate at any stage you can just fix.

cloneslad

I have no idea how much your mortgage is, but with a sample 300k mortgage for 25 years you would be looking at the following:

2.9%

€1,407 per month
€122,123.84 in interest payments

2.6%

€1,361.01 per month
€108,302.56 in interest payments

You’d have approx €50 per month in your pocket and you’d pay approx €14k less in interest.

2.6% with the added monthly payment (using the saving of €50 you’re making from not paying 2.9%)

€1,411.01 per month
€102,518.02 in interest payments
Mortgage life = 23 years 10 months

So you’d save approx €20,000 on this rate compared to the 2.9% and you would knock 1 year and 2 months off the mortgage. (Ulster bank allow overpayment of 10% of the remaining mortgage balance).


Now, what you must take into consideration of the above.

You can only guarantee the fixed rate for 4 years but I’m making this based on the only figures we know that you can get right now.

You must also factor in that the 2.9% rate could increase tomorrow and that if the variable rates available after the four years of payments will probably be standard enough across the board / ulster bank will have similar level fixed rates for you to move into.

Ulster bank also have a 2.3% fixed for 2 years, I think it’s for LTV less than 80%, which it would be on the figures above.

Finally, BOI sent me my fixed rate renewal last week at their standard 3% with 4.5% variable (or similar) and when I told them Ulster Bank offered me 2.6% they offered 2.8% and a 3.5% variable while I made up my mind.

ted1

Don’t look at their interest rate. Look at their APR. Eg. EBS advertising the lowest rate. But their APR was higher than others with a higher interest rate.

Joe Ripe Face

Joe Ripe Face wrote: »

Yeah it might cost that.

I will just reiterate that after the 4 years you can just take whatever fixed rate UB are offering at that time, which will be much lower than 4.5%

How can you predict fixed rates 4 years in advance?

masterboy123

This is clear now, thank you so much!

Will go for Ulster Bank so.

cloneslad wrote: »

I have no idea how much your mortgage is, but with a sample 300k mortgage for 25 years you would be looking at the following:

2.9%

€1,407 per month
€122,123.84 in interest payments

2.6%

€1,361.01 per month
€108,302.56 in interest payments

You’d have approx €50 per month in your pocket and you’d pay approx €14k less in interest.

2.6% with the added monthly payment (using the saving of €50 you’re making from not paying 2.9%)

€1,411.01 per month
€102,518.02 in interest payments
Mortgage life = 23 years 10 months

So you’d save approx €20,000 on this rate compared to the 2.9% and you would knock 1 year and 2 months off the mortgage. (Ulster bank allow overpayment of 10% of the remaining mortgage balance).


Now, what you must take into consideration of the above.

You can only guarantee the fixed rate for 4 years but I’m making this based on the only figures we know that you can get right now.

You must also factor in that the 2.9% rate could increase tomorrow and that if the variable rates available after the four years of payments will probably be standard enough across the board / ulster bank will have similar level fixed rates for you to move into.

Ulster bank also have a 2.3% fixed for 2 years, I think it’s for LTV less than 80%, which it would be on the figures above.

Finally, BOI sent me my fixed rate renewal last week at their standard 3% with 4.5% variable (or similar) and when I told them Ulster Bank offered me 2.6% they offered 2.8% and a 3.5% variable while I made up my mind.

Sleeper12

Will they fix for a longer period? I'd fix f as long as possible. EU base rate is at its lowest ever. 0% if memory serves so it can't go any lower.

masterboy123

Yea getting fixed at 4 years.

PTSB giving 5 years fixed but need to open a current account with them.

Sleeper12 wrote: »

Will they fix for a longer period? I'd fix f as long as possible. EU base rate is at its lowest ever. 0% if memory serves so it can't go any lower.

Sleeper12

masterboy123 wrote:

PTSB giving 5 years fixed but need to open a current account with them.

I'm mortgage free now but if I wasn't I'd be fixing for as long as possible. Even four years is a help though. The first four or five years are the toughest on the average mortgage. For most people things get easier after that. Wages increase slightly & inflation means that you pay less in real terms year after year.

ted1

Sleeper12 wrote: »

Will they fix for a longer period? I'd fix f as long as possible. EU base rate is at its lowest ever. 0% if memory serves so it can't go any lower.

Base rate is low but Irish banks are still way higher than European banks. My friend just fixed for 20 years in France with a rate of 1.3%

In five years time we “should “ be more integrated and get European rated.

Q&A

ted1 wrote: »

Base rate is low but Irish banks are still way higher than European banks. My friend just fixed for 20 years in France with a rate of 1.3%

In five years time we “should “ be more integrated and get European rated.

Rates are higher in Ireland partly because lending for home purchases is comparatively more risky here than other parts of Europe. A foreign bank wanting to lend here would face the same risk and would in turn look for higher return i.e., mortgage rates are higher in Ireland than in France because on average Irish mortgages are likely to default more than those in France.

Over time we might become less risky but that is a slow moving process which will require years of people repaying their mortgages.

stefanovich

Be very careful about remortgaging. It's an amortised loan where you pay interest up front. If you refinance you will reset this amortisation schedule, increasing the amount of upfront interest the bank receives and reducing what you pay off the principal. Your monthly payments may be lower but you will be likely increasing the amount of total interest you pay and lengthening the time it will take to pay off the principal, which means if you sell you have less equity in the house.

Sometimes it is better to save and make a large overpayment to reduce monthly payments.

https://dash2retire.com/2018/01/16/home-mortgage-the-great-american-rip-off/

Anyone remortgaging at a lower rate should consider maintaining or even increasing the monthly payment & never increasing the term.

I went from a high variable rate to a decent enough fixed rate with a 50% (+actually) agreed overpayment.

Bob24

Q&A wrote: »

Rates are higher in Ireland partly because lending for home purchases is comparatively more risky here than other parts of Europe. A foreign bank wanting to lend here would face the same risk and would in turn look for higher return i.e., mortgage rates are higher in Ireland than in France because on average Irish mortgages are likely to default more than those in France.

Over time we might become less risky but that is a slow moving process which will require years of people repaying their mortgages.

Indeed, our high defaulting rate, low repossession rate, and the persistence of tracker mortgages all mean Irish banks have to make more money with interests in new loans.

The door of foreign banks is not completely closed though. I actually asked a French bank when I needed a mortgage to buy in ireland, and the banker was not against the idea. The only thing is he wanted a collateral in France to cover the mortgage amount (which means the French bank would cover itself with an asset in France and avoid the Irish risk of not being able to repossess which you mention), which I unfortunately didn’t have. So while that bank wouldn’t accept the Irish property someone is buying as a safe collateral, if there is something else to offer to them instead as a collateral they would be happy to offer a mortgage with French terms knowing the money will be used to purchase that Irish property.

Sleeper12

ted1 wrote: »

Base rate is low but Irish banks are still way higher than European banks. My friend just fixed for 20 years in France with a rate of 1.3%

In five years time we “should “ be more integrated and get European rated.

I agree & it's terrible but Irish banks have lost money on trackers for 10 years now. They now have to compensate homeowners that they shafted over the tracker. Customers not on trackers are paying extra to make up for the money lost on trackers. This isn't going away anytime soon. It's highly unlikely that Irish banks will lower rates any further

Bob24

Sleeper12 wrote: »

I agree & it's terrible but Irish banks have lost money on trackers for 10 years now. They now have to compensate homeowners that they shafted over the tracker. Customers not on trackers are paying extra to make up for the money lost on trackers. This isn't going away anytime soon. It's highly unlikely that Irish banks will lower rates any further

It’s not just trackers. High defaulting rates and very limited repossession options compared other European countries are increasing the cost of a mortgage business a lot, and at the end of the day that cost is passed to borrowers with higher rates.

Irish_peppa

Joe Ripe Face wrote: »

I will just reiterate that after the 4 years you can just take whatever fixed rate UB are offering at that time, which will be much lower than 4.5%

You think Mortgage Rates will go down? But isnt the ECB signalling rates will start going up from summer 2020 They have been signalling it for a long time now.

The ECB last raised interest rates in 2011, then cut them to record lows in 2016 to fight deflation.

https://www.irishexaminer.com/breakingnews/business/ecb-interest-rate-hike-likely-delayed-to-mid-2020-896406.html

newirishman

Sleeper12 wrote: »

I agree & it's terrible but Irish banks have lost money on trackers for 10 years now. They now have to compensate homeowners that they shafted over the tracker. Customers not on trackers are paying extra to make up for the money lost on trackers. This isn't going away anytime soon. It's highly unlikely that Irish banks will lower rates any further

No Irish bank is losing money on a performing tracker mortgage.

Sleeper12

newirishman wrote:

No Irish bank is losing money on a performing tracker mortgage.

Just in case you haven't seen the news for the last few years banks now have to compensate homeowners to the tune of billions because they ripped them off over trackers. There have been suicides because of people losing their homes when the banks illegally bullied homeowners from the tracker rate.

It is a fact that banks are losing on the whole tracker fiasco. They have publicly stated several years ago that they cannot lower the variable rate because trackers are costing them so much.

ted1

Sleeper12 wrote: »

They have publicly stated several years ago that they cannot lower the variable rate because trackers are costing them so much.

Do you believe them ?

newirishman

Sleeper12 wrote: »

Just in case you haven't seen the news for the last few years banks now have to compensate homeowners to the tune of billions because they ripped them off over trackers. There have been suicides because of people losing their homes when the banks illegally bullied homeowners from the tracker rate.

It is a fact that banks are losing on the whole tracker fiasco. They have publicly stated several years ago that they cannot lower the variable rate because trackers are costing them so much.

Any of you what wrote there does not change the fact the banks are not losing money on performing tracker mortgages. Are they making a lot of money? No. But the net interest margin is very much positive for the tracker book, even if it is small. The tracker fiasco does not overall change that significantly.
I recommend a read through the financial statements of the various banks.

Sleeper12

ted1 wrote:

Do you believe them ?

The government does. I believe that the banks blamed the cost of trackers for high interest rates when they called to explain themselves to the Dail.

newirishman wrote:

Any of you what wrote there does not change the fact the banks are not losing money on performing tracker mortgages. Are they making a lot of money? No. But the net interest margin is very much positive for the tracker book, even if it is small. The tracker fiasco does not overall change that significantly. I recommend a read through the financial statements of the various banks.

What are you arguing about??

It's you that stuck in the term "preforming" trackers. I never said that.

Is it possible for a preforming tracker not to make money? Maybe I'm wrong here but I would assume that the term preforming means that it's making money.

Can a loss making tracker be called a preforming tracker?

Maybe I'm wrong but to me preforming means profit making or at the very least non loss making?

newirishman

Sleeper12 wrote: »

The government does. I believe that the banks blamed the cost of trackers for high interest rates when they called to explain themselves to the Dail.



What are you arguing about??

It's you that stuck in the term "preforming" trackers. I never said that.

Is it possible for a preforming tracker not to make money? Maybe I'm wrong here but I would assume that the term preforming means that it's making money.

Can a loss making tracker be called a preforming tracker?

Maybe I'm wrong but to me preforming means profit making or at the very least non loss making?

You said the banks are losing money in the tracker mortgages. This is in fact not correct.
Performing essentially means that the money plus interest is being paid back and that there are no arrears. It doesn’t necessarily mean making a profit, for example if the banks financing costs are higher than what they can in return charge in interest. Which is currently not the case.

Sleeper12

newirishman wrote:

You said the banks are losing money in the tracker mortgages. This is in fact not correct. Performing essentially means that the money plus interest is being paid back and that there are no arrears. It doesn’t necessarily mean making a profit, for example if the banks financing costs are higher than what they can in return charge in interest. Which is currently not the case.

Banks are losing money hand over fist on their tracker mortgages. You then decided to Seperate the loss making ones from the profitable ones to argue with. I never Seperated loss making from profit making ones. It is a fact that banks are losing money on their overall tracker mortgages.

Just because they make a profit on some trackers doesn't mean that they are making an overall profit on trackers.

It is a fact that people on variable rates are paying more to compensate the banks for the billions that the tracker mortgages are costing. The banks have stated this to the government. This is fact

newirishman

Sleeper12 wrote: »

Banks are losing money hand over fist on their tracker mortgages. You then decided to Seperate the loss making ones from the profitable ones to argue with. I never Seperated loss making from profit making ones. It is a fact that banks are losing money on their overall tracker mortgages.

Just because they make a profit on some trackers doesn't mean that they are making an overall profit on trackers.

It is a fact that people on variable rates are paying more to compensate the banks for the billions that the tracker mortgages are costing. The banks have stated this to the government. This is fact

As I have been trying to explain to you, this is not correct. Banks are not losing money “hand over fist” on their tracker book. Margins are low but not loss making.
Fact is what you can read in the banks financial statements. You should have a read.

You won’t get an argument from me that the current mortgage rate offerings are very high compared to what you can find in other European countries.

You will also find that many people don’t care or even know how high their interest rate is, given the very low number of switcher mortgages, or the apparently very successful “cash-back” offers.
So why would a bank lower the rate if the market pressure is not there?

Sleeper12

newirishman wrote:

As I have been trying to explain to you, this is not correct. Banks are not losing money “hand over fist†on their tracker book. Margins are low but not loss making. Fact is what you can read in the banks financial statements. You should have a read.

You continue to ignore the billions in compensation that the banks have to pay out because of the tracker mortgages. In business you can't cherry pick parts of the business when reporting profits or loss. You have to take the whole. The whole of the tracker business is costing the banks hand over fist. They are paying multiple times more in compensation than than they are making on trackers. The compensation is part of the tracker book.

In your posts you are trying to cherry pick so you can show that they are making profits on trackers. Any accountant will tell you that you can't do this. "Cooking the books" is what this is called. If you tried to get investors or to sell the business with your method you can go to jail

Graham

Sleeper12 wrote: »

You continue to ignore the billions in compensation that the banks have to pay out because of the tracker mortgages.

Which of the banks haven't already made provisions in their financial statements for those payouts?

Sleeper12

Sleeper12 wrote: »

......The whole of the tracker business is costing the banks hand over fist. They are paying multiple times more in compensation than than they are making on trackers. The compensation is part of the tracker book.

....

By costing you mean a gross loss ?
Or not as profitable as the SVR or fixed mortgages?

Also can you quantify in actual figures what hand over fist is?

Sleeper12

Graham wrote:

Which of the banks haven't already made provisions in their financial statements for those payouts?

It doesn't matter where they take the money from. It's still losses from trackers. Also taking money from somewhere else the money still needs to be replaced.

Let's be clear here. I'm not sticking up for the banks

Graham

Sleeper12 wrote: »

It doesn't matter where they take the money from. It's still losses from trackers. Also taking money from somewhere else the money still needs to be replaced.

Let's be clear here. I'm not sticking up for the banks

If a bank has already booked the losses, it doesn't need to keep doing it ad infinitum.

Sleeper12

Augeo wrote:

By costing you mean a gross loss ? Or not as profitable as the SVR or fixed mortgages?

By costing I mean the banks are paying out more due to tracker compensation than they are making from the profitable ones. This is called a net loss. Net loss means that they are not making profits on trackers at the moment. This is likely to be the case for years to come

Augeo wrote:

Also can you quantify in actual figures what hand over fist is?

No I can't quantity this & to be honest I doubt the banks can either as they are still "discovering" more trackers that have to be paid compensation. We haven't gotten to final numbers yet.

ted1

Sleeper12 wrote: »

By costing I mean the banks are paying out more due to tracker compensation than they are making from the profitable ones. This is called a net loss. Net loss means that they are not making profits on trackers at the moment. This is likely to be the case for years to come



No I can't quantity this & to be honest I doubt the banks can either as they are still "discovering" more trackers that have to be paid compensation. We haven't gotten to final numbers yet.

So the tracker isn’t costing them money. Mis management and poor ethics is costing them

Sleeper12

Graham wrote:

If a bank has already booked the losses, it doesn't need to keep doing it ad infinitum.

I'm not sure what your point is there.

Where did they get the money? It hardly a gift so it needs to be paid back over the years to come.
They can't book the losses as they don't know what the total is yet or how many people they will pay out to. They can set aside money for future compensation from other departments but the trackers are still costing them money. If the insurance part of Bank of Ireland pays the loss now then most likely bank of Ireland lending will have to pay this back to bank of Ireland insurance. Bank of Ireland lending could be repaying this for years to come. So long as these repayments are greater than current profits from trackers then their trackers are loss making.

Taking money from profits in a different part of the business doesn't mean that trackers are profitable. If they make a million this year in profits from functioning trackers but pay out 50 million in compensation for bad trackers then they are not making profits from trackers this year. Even taking the compensation money from profits in life insurance still doesn't mean that the trackers are making a profit.

The banks told the government a few years ago that they can't reduce interest rates because the trackers are costing them money.

Sleeper12

ted1 wrote:

So the tracker isn’t costing them money. Mis management and poor ethics is costing them

You could by perfectly correct there. You can call it what you want really. The bottom line is that their tracker book is loss making. The idea of trackers might be sound & maybe it's bad management that caused these losses but they are losses & non tracker rates will remain high till these losses are repaid. They have made this clear & despite the government owning huge amounts of the banks there is no sign of the government stopping this practice of high rates.

Graham

Sleeper12 wrote: »

The banks told the government a few years ago that they can't reduce interest rates because the trackers are costing them money.

We've moved on a few years.

Performing tracker mortgages are profitable.

i.e. the banks can borrow money at a lower interest rates than they are charging tracker customers.

Sleeper12

Graham wrote:

Performing tracker mortgages are profitable.

Again with the "preforming". I never once said that preforming trackers aren't profitable. I said overall trackers are making a loss because of the billions compensation that the bad ones cost. I've already said this in this thread but a business can't cherry pick & claim that trackers are profitable & hide away the loss making ones. Trackers will be a net loss for years to come because of the compensation already paid out & will be paid out in years to come.

I find it hard to read my own tone at times. If I am coming across as snippy, I don't mean to be.

Graham

Provisions for the redress scheme have already been made/booked/accounted for/written off.

Historically, trackers may have been loss making for a period (as was pretty much all lending). Now they're not.

Sleeper12

Graham wrote:

Provisions for the redress scheme have already been made/booked/accounted for/written off.

You've said that already. There's a few issues with the statement though.

1. No one knows the total cost so its impossible for it to be booked, & written off.

2. A homeowner can take the amount offered by redress as an initial payment but still have the right to further action /payment.

3. Remember people have taken their own lives over what the banks did. How much will their families get in court? People had to leave the country over this mess. How much do they get?

4. Where did this redress money come from? They didn't sum it up out of mid air. If they borrowed it from a different department of the bank then it would need to be repaid. If boi life loaned it to boi mortgage then it will be on their books for years to come. Borrowing money from one department isn't booking it & writing it off. It's spreading the cost over the next few years or decade.

5. They are still discovering (at least up to a few months ago) new accounts that are effected that they didn't know about.

Looking at the above I don't believe that the banks know how many people are effected or how much each will cost in the end. How many marriages broke up over this? There will be law suits for years to come.

Even if they magically guessed how much they will have to pay out & they have this money put aside it still has to be paid back to wherever they borrowed it from.

At the end of the day we are arguing semantics here. Another poster tried to make out that I said all trackers are loss making. I didn't say that. Right now some trackers are making a profit but when you factor in the loss making trackers the bank is loosing money on trackers.

The banks aren't reducing interest rates because of this. This is their words not mine. This is what they told a Dail committee or the Dail itself, I can't remember witch.
If this isn't the case why wouldn't the biggest shareholders (the government) insist that they reduce the rates?

newirishman

Sleeper12 wrote: »

You've said that already. There's a few issues with the statement though.

1. No one knows the total cost so its impossible for it to be booked, & written off.

2. A homeowner can take the amount offered by redress as an initial payment but still have the right to further action /payment.

3. Remember people have taken their own lives over what the banks did. How much will their families get in court? People had to leave the country over this mess. How much do they get?

4. Where did this redress money come from? They didn't sum it up out of mid air. If they borrowed it from a different department of the bank then it would need to be repaid. If boi life loaned it to boi mortgage then it will be on their books for years to come. Borrowing money from one department isn't booking it & writing it off. It's spreading the cost over the next few years or decade.

5. They are still discovering (at least up to a few months ago) new accounts that are effected that they didn't know about.

Looking at the above I don't believe that the banks know how many people are effected or how much each will cost in the end. How many marriages broke up over this? There will be law suits for years to come.

Even if they magically guessed how much they will have to pay out & they have this money put aside it still has to be paid back to wherever they borrowed it from.

At the end of the day we are arguing semantics here. Another poster tried to make out that I said all trackers are loss making. I didn't say that. Right now some trackers are making a profit but when you factor in the loss making trackers the bank is loosing money on trackers.

The banks aren't reducing interest rates because of this. This is their words not mine. This is what they told a Dail committee or the Dail itself, I can't remember witch.
If this isn't the case why wouldn't the biggest shareholders (the government) insist that they reduce the rates?

You are clearly not reading any of the replies.
Anyways - just on your pt 1: of course is it possible to make a good estimate and therefore reasonably accurate provisions for the redress costs.
The rest of your points make equally no sense.

The tracker book is not loss making for Irish banks.
There are a multitude of reasons for the comparably higher mortgage interest rates in Ireland. The limited earnings on the tracker book are only one of them.

Graham

Sleeper12 wrote: »

The banks aren't reducing interest rates because of this.

You're mixing up all sorts of emotional statements, emotive questions, historical facts, guesses and vague recollections to try and arrive at some sort of conclusion about the profitability of tracker mortgages and the effects on current mortgage rates.

Based on all of the above, you're stating as fact that which is not and using it to predict future interest rates.

I'd suggest inability/unwillingness to repossess property securing non performing mortgages was a much more significant factor in Irish mortgage rates.

Sleeper12

newirishman wrote:

The tracker book is not loss making for Irish banks. There are a multitude of reasons for the comparably higher mortgage interest rates in Ireland. The limited earnings on the tracker book are only one of them.

It's you not reading my posts correctly.

There could be thousands of reasons why Internet rates are so hight in Ireland however the only reason ever given by the banks to the government was trackers. The government accepted this explanation. Don't shoot the messenger.

Current trackers are profitable as I've already stated however when you add the loss making ones as you do in normal accounting then the overall picture is a loss. When your loss is greater than the profits you end up with a loss. You can't change this fact.

Take last year January to December the banks paid out over half a billion in redress. It's actually around 700 million. This half a billion is a loss for trackers. The current trackers in profit didn't make half a billion in profit to balance this. This was a net loss last year on trackers. Another 1300 trackers affected were discovered last August alone. The central bank says they believe that there could still be more. The banks haven't even been fined yet. That comes later this year or even next year. These fines will sit on the loss side of the tracker balance sheet.

Sleeper12

Graham wrote:

I'd suggest inability/unwillingness to repossess property securing non performing mortgages was a much more significant factor in Irish mortgage rates.

Do you suppose that this will change in the next 5 years?

Even just going on your above post the logical thing to do is to lock in a decent fixed rate for as long as possible.

We've come a very long way round to end up with the same advice. Fix as long as possible & it's highly likely variable rates will come down. Much more likely to increase over the next four years. EU have stated increasing rates next year. Brexit or trump might change that but as we can't see into the future we can only go on the facts at hand.

masterboy123

Great. I understand i need to go for max possible Fixed rate at this stage.

Thanks everyone.

Sleeper12 wrote: »

Do you suppose that this will change in the next 5 years?

Even just going on your above post the logical thing to do is to lock in a decent fixed rate for as long as possible.

We've come a very long way round to end up with the same advice. Fix as long as possible & it's highly likely variable rates will come down. Much more likely to increase over the next four years. EU have stated increasing rates next year. Brexit or trump might change that but as we can't see into the future we can only go on the facts at hand.

Sleeper12

masterboy123 wrote:

Great. I understand i need to go for max possible Fixed rate at this stage.

Well that's my opinion but plenty here seems to disagree with my judgement