Good news is underway for those looking to enter the housing market, but find borrowing rates to be making it too expensive.
There’s a mortgage rate war.
Though this term sounds less than appealing, it is a war in favor of getting lower rates to borrowers and moving more first time buyers into the housing market.
As discussed in a previous posting, Ulster bank recently announced dramatic cuts in their variable and fixed mortgage rates.
The question racking everyone’s brain after such an announcement was, will other banks fall in line to stay competitive in the market?
Ulster caused increased competition in the market and even more so, posed a threat to the other banks.
These other banks were beginning to notice that in order to stay competitive they only had one choice…
To get to Ulster Bank levels or face the result that they may lose all new entrants into the market as well as some of the old.
Shortly after the announcement of Ulster Bank to reduce their mortgage rates, followed KBC by decreasing their fixed rates as well.
Next, just after the cuts made by KBC, we saw the third cutback take place. A sign in the country that the war was one. Permanent TSB announced drastic rate cuts on their end as well.
Permanent TSB’s announcement is going to put them in a highly competitive spot for new borrowers and it is likely, the flow of business will begin going towards them.
However, with the war picking up traction it is likely these cute will not be the only cuts made. Whether it be other banks choosing to make cuts or further cuts from the same three, it is possible that this battle is not over.
It will come increasingly important that first time home buyers perform extensive research into the offerings of their bank options before making a choice as these banks are increasing their competitiveness by increasing their attractiveness.
With cash back options only being the beginning to this mortgage banking war.
As the main target of this war being first time home buyers, we are beginning to see a shift in the opportunities for home movers as well.
Permanent TSB has now announced a cut to their existing fixed-rates for borrowers with a loan to value ratio of 60-80 percent. As well as offering movers the same cashback opportunities they are giving to buyers.
Though these offerings are very attractive and enticing to home buyers as well as movers, it is just as vitally important as ever that those looking for a place in the market compare mortgage rates across the board and refrain from getting distracted by the cash back deals that are so tempting.