gnf_ireland
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Extract taken from Richie Boucher's attendance at the Oireachtas sub-committee
The problem with the headline rates quoted for UK mortgages is they fail to take into account what the customer rolls over onto. 1.4% for 2 years rolling over onto 4.5% is no more sustainable than the Irish scenario. In the UK, arrangement fees as also the norm, were we are moving to the norm of 'negative' arrangement fees in the form of cashback.
One thing that has struck me about the UK market is there must be a high level of switching/remortgaging/renegotiation done. The rollover rates are very high in comparison to the initial 'introductory' rates, which must encourage switching. If not, I wonder why that is? Is it the same reasons as in Ireland?
Would this model work in Ireland - so a 2/3/5 year introductory rate of say 1.5% along with a 1000 euro arrangement fee, rolling back onto a 3.75% rate?
I cannot see how large numbers of people would switch in the case they have to pay to do so, when the numbers are so low when they are in effect paid to switch.
I am sure a small percentage would switch every 2 or 3 years, but imagine it would be a very small number.
Anyone have access to the switching levels in the UK, or know where I could find them?
The problem with the headline rates quoted for UK mortgages is they fail to take into account what the customer rolls over onto. 1.4% for 2 years rolling over onto 4.5% is no more sustainable than the Irish scenario. In the UK, arrangement fees as also the norm, were we are moving to the norm of 'negative' arrangement fees in the form of cashback.
One thing that has struck me about the UK market is there must be a high level of switching/remortgaging/renegotiation done. The rollover rates are very high in comparison to the initial 'introductory' rates, which must encourage switching. If not, I wonder why that is? Is it the same reasons as in Ireland?
Would this model work in Ireland - so a 2/3/5 year introductory rate of say 1.5% along with a 1000 euro arrangement fee, rolling back onto a 3.75% rate?
I cannot see how large numbers of people would switch in the case they have to pay to do so, when the numbers are so low when they are in effect paid to switch.
I am sure a small percentage would switch every 2 or 3 years, but imagine it would be a very small number.
Anyone have access to the switching levels in the UK, or know where I could find them?
