Ulsterbank recently upped the ante in the mortgage rate-war by reducing a suite of their rates, the story was covered in the Independent which also quoted Irish Mortgage Brokers.
Karl Deeter said the cuts represent the latest shot to be fired in the mortgage rate war.
“In response to Avant Money’s European-style rates, Ulster Bank has had to respond and now it means that other lenders are under even greater pressure to follow or beat these rates.”
He said this means customers will win. But they have to switch lender is they are paying high rates.
It’s bizarre but true. A recent study by the Central Bank showed that the majority of borrowers stood to really gain in payment savings and interest payments by switching their mortgage and yet only a tiny fraction actaully do it.
Who do you know that would walk by a free €10,000? Nobody right? Yet you do, it may even be you, because if you pay a bank thousands more than you ought to because you aren’t willing to take the time to do some paperwork and switch your loan that’s precisely what happens!
Here are the main findings (verbatim) from the Central Bank:
Three in every five eligible mortgages stand to save over €1,000 within the first year if they switch mortgage provider, and more than €10,000 over the remaining term. Just 2.9% of mortgages switched provider in the second half of 2019. A diverse range of factors may inhibit switching, including psychological factors, lack of knowledge on the costs and benefits, and the perceived complexity.
Get in touch at firstname.lastname@example.org apply online or call us and we can help …
We are really pleased to be among the very small and select group of brokers in the country who were asked to be part of the AvantMoney lending panel. If you want a low cost fixed rate from the mortgage arm of AvantCard then you must go through a broker and we’d be happy to help you should you want to work with a firm that has been around for almost 20 years and where every advisor has at least a decade of experience. Call us to find out more 01 6790990
There has been a lot of news about banks not lending to people who are receiving any wage supplements during the covid 19 pandemic. The initial headlines were about AIB who later rowed back on the decision not to assess any cases where people were on wage supports.
The other banks were more open to offering loans but they all have one basic trend in common which is that you can’t be on TWSS and draw down a loan. This may seem unfair but if you got a loan in July and were laid off in August in time a person would wonder ‘why did the bank give that loan?’ given that companies can only get wage supports if their turnover is seriously impacted due to the pandemic. So what can you do?
Delay: for many people they’ll be back to regular wages soon, talk to the people involved in your transaction and see if they are willing to wait. Withdraw: most contracts have ‘subject to mortgage approval’ in them. Ask your employer to take you off the support scheme: …
In an interview that drew a massive listener reaction, Pat Kenny interviewed Karl Deeter about the reasons he believes we need to get people back to work sooner rather than later. We would stress the point that this isn’t implied as doing so in a reckless manner, hand hygiene, distancing and other protocols already being followed in shops and essential services jobs would be required. Dr. Sam McConkey was also on to critique his view. The debate was well rounded and respectful, you can listen to the clip below.
We were part of a discussion around Covid19 and mortgages on Matt Cooper’s ‘The Last Word’ show on Today FM yesterday. The other participant was Brian Hayes of the Banking and Payments Federation of Ireland.
For our part we were impressed with the fact that the banks have been able to do more than 2,000 mortgage restructures per working day since the pandemic driven mortgage breaks were announced. To put that in perspective, it took six years to do 100,000 restructures after the financial crisis. This time around that figure could be achieved in a little over two months, that is something to be commended.
Conor Pope of The Irish Times did an article on housing and quoted our firm extensively, see the screengrabs below.
“More recently we have proposed removing mortgage loan-to-value ratio (LVR) restrictions, as this is a countercyclical tool and we have been able to consider lowering this now that the risks of excessive lending have subsided and banks can now lean into a recovery. This should also enable banks to support customer needs”
That spells it out fairly loud and clear, if the tool isn’t needed then why deploy it? At the moment we are seeing massive issues with sales due to banks restricting in order to comply with the lending rules, this is an unforeseen consequence that will damage certain borrowers who have entered into contracts in good faith.
It’s worth noting that we took our lead in part from New Zealand on the lending rules, our new Governor is from there and house prices in New Zealand are also high – …