Dilosk offered better rate at last, but its fixed !

Hi all, Finally after many many months of numerous calls to Dilosk over my 4.5% SVR, they have agreed to reduce it to either:

a 2 yr fixed rate at 3.6% or
a 3 yr fixed rate at 3.5%

I know no-one can tell what the future holds with interest rates but would I be mad locking in for 3 yrs?
Appreciate any advice out there, Thanks,

Are you in a position to switch lenders? Will you be within the next year or so?

Is it a home or a buy to let?

Brendan

Hi Brendan, Its for our home, I don't think we would be able to switch lenders due to negative equity on buy to lets of approx 60/70K, which will take a good few yrs yet to pay down.

If you can't switch, you won't benefit from any competition which might arise due to a new entrant.

The only hope for the 150,000 people like you is if the Government introduces legislation to control mortgage rates. My proposal is that lenders would be allowed to charge up to 3% above the ECB rate. If they wanted to charge more, they would have to justify it to the Central Bank.

If you have an LTV on your home below 80%, then you may be able to switch lenders. You should check that out first.

Agree with Brendan that you should definitely establish whether or not you are in a position to switch before making any decisions.

If that proves to be impossible then I would be sorely tempted to fix for two (or even three) years at the above rates if I was in your position. It is certainly possible that your lender will further reduce the rates on their fixed (or variable) rate offerings but any such future cuts would have to be made fairly quickly, or would have be relatively aggressive, for you not to come out ahead by fixing now. It is also possible, of course, that rates will rise during the fixed rate period.

Ultimately, only time will tell whether fixing now proves to be the right decision but a reduction of 1% on your current rate is pretty significant.

I would personally be in favour of the introduction of a statutory cap on variable rate mortgages but I don't see any realistic prospect of such legislation being introduced in the near future.

I have a mortgage with Dilosk and got s 0.4% discount on my svr of 4.35 about 6 months ago. They werent doing fixed rates at the time. I discovered they were doing fixed rates last week when i rang to check balance. Tempted to fix now for 2 or 3 years. I have a BTL in negative equity of about €80-85k. Switching is not an option.

Dilosk/ICS are not great at communicating these fixed rates.

Hi all, tks for your feedback, it took me many months of arguing with them over the rates for them to do anything for me, even though my LTV is 35%, I pointed this out to them on numerous occassions and there was no budge for many months. I don't think we could move as one of the BTL's is a section 23 in a rural location that was bought at the height and we would be lucky to get quarter of what we gave for it, so have to just keep paying it down every yr, Also due to the fact that this BTL is outside Dublin KBC would not talk to us at all. So based on this I feel I have no other option than to stick with Dilosk but hope I am not making a bad decision if I lock in for 3 yrs at 3.5%

I am stunned that you can't refinance a loan with such a low LTV. Why should any bank care that you have underwater BTLs with another lender if you can comfortably service their loan to you?

In any event, you won't be making a "bad" decision if you decide to fix for three years. You can only make a decision on the basis of the facts that are known to you today - don't confuse strategy with outcome.

Thanks for your feedback Sarenco, if i was able to refinance this loan with another bank, who would be my best option to try ? Thanks

Hi Sarenco, before I sign up for the 3 yrs fixed can you let me know what other bank I should be trying for a better rate than 3.5% with a 35% LTV, Thanks,

Well it really depends what type of mortgage product you want.

BOI offer broadly comparable fixed rates to what you have already been offered but have a pretty attractive 2% cash back incentive. PTSB has a discounted variable rate mortgage that might make sense if you intended to pay off the mortgage in short order. EBS and AIB have the most competitive (non-discounted) variable rates but don't offer any incentive to switchers. The Ulster Bank variable rate offering is also competitive for switchers at low LTVs.

In your circumstances, it might make sense to engage a mortgage broker to do some of the leg work for you.