Actually you can avoid this by going for a fixed rate. I did many times and actually looking back I'd have been better off financialy if I'd gone the variable route.
Interest rate hikes for AIB, EBS & Haven customers
- Thread starter Knuttell
- Start date
Actually you can avoid this by going for a fixed rate. I did many times and actually looking back I'd have been better off financialy if I'd gone the variable route.
It doesn't change the fact that banks have people over a barrell. And signing up to a contract that can go up by €100s of euro a month over time at a lender's whim should not be an available option to residential borrowers.
Variable rate mortgages should be banned on the grounds they are unfair practice, predatory lending, call it what you will.
Variable rate mortgages should be banned on the grounds they are unfair practice, predatory lending, call it what you will.
I'm afraid this could be the straw that broke the camel's back for us...
In the last year we've been suffocated into arrears by this rate increases. Still making full payments but just about...
Tracker was not an option for us when we got our mortgage and we fixed for 3 years and still are finding it impossible to keep affloat.
One solution that is being circulated is a tweaking of TRS for mortgage holders. i.e
a reduction after a certain point for those on trackers and an increase for SVR holders.
I know the Tracker mortgage brigade will snarl at this idea but as it stands it is simply not fair that SVR mortgage holders are been shaken upside for all their income to fund the gap that trackers have created.
... And you can say what you like about SVR going up/down, etc... and we should be prepared for it.Yes! may be we should but I aint got a salary increase since 2008.
Since then the cost of fuel, childcare, tax, VAT, stealth tax, living, have ALL increased on top of property taxes, household charges, etc...
It's painful to watch this play out in front of you and no one in Daíl giving a toss.
Never again will I vote Fine Gael, never!
In the last year we've been suffocated into arrears by this rate increases. Still making full payments but just about...
Tracker was not an option for us when we got our mortgage and we fixed for 3 years and still are finding it impossible to keep affloat.
One solution that is being circulated is a tweaking of TRS for mortgage holders. i.e
a reduction after a certain point for those on trackers and an increase for SVR holders.
I know the Tracker mortgage brigade will snarl at this idea but as it stands it is simply not fair that SVR mortgage holders are been shaken upside for all their income to fund the gap that trackers have created.
... And you can say what you like about SVR going up/down, etc... and we should be prepared for it.Yes! may be we should but I aint got a salary increase since 2008.
Since then the cost of fuel, childcare, tax, VAT, stealth tax, living, have ALL increased on top of property taxes, household charges, etc...
It's painful to watch this play out in front of you and no one in Daíl giving a toss.
Never again will I vote Fine Gael, never!
Pinkpanter
Registered User
- Messages
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Mortgage interest relief is calculated on the interest payment.
Our tracker mortgage interest relief has dropped substantially with the
falling rates. Therefore if your interest portion of mortgage is high due
to higher interest rates you get a higher payment. Not much to be happy
about I'm afraid!
Our tracker mortgage interest relief has dropped substantially with the
falling rates. Therefore if your interest portion of mortgage is high due
to higher interest rates you get a higher payment. Not much to be happy
about I'm afraid!
You need to be looking at Fianna Fail if you want to blame a political party,those are the guys who have landed us in this almighty mess.
Fine Gael are now doing the spade work trying to sort it out and because its all so fubared the fix will be painful to the nth degree for most of us.
Ha! I certainly won't be votoing for them either...
No, sorry but I've had cases/queries/issues which impacted me and my family greatly, dismissed by this Fine Gael govt. ministers to learn my lesson.
Never again!
In all of this, Has anyone undertaken any analysis of the value of fixed rates in retail mortgages?
It would have to be point in time but it would interesting to see what total interest was paid by the person who locked into a, say 3 year rate in 2010 versus the person with the same mortgage on svr.
I'd guess the svr holder is better off now. There seems to be a premium payable for hedging. As for trackers, sure it's irrelevant unless you were, dare I say it, mis-sold an svr instead of a tracker when it was available at the time.
I have an ltv/svr just over a year with AIB and the increases are sickening but the alternative fixed rate was not palatable and they were the cheapest in the market at the time. I'd be more annoyed if I had fixed for a year and was coming off now at the higher rate, but perhaps someone knows if I'm blissful in my ignorance?
It would have to be point in time but it would interesting to see what total interest was paid by the person who locked into a, say 3 year rate in 2010 versus the person with the same mortgage on svr.
I'd guess the svr holder is better off now. There seems to be a premium payable for hedging. As for trackers, sure it's irrelevant unless you were, dare I say it, mis-sold an svr instead of a tracker when it was available at the time.
I have an ltv/svr just over a year with AIB and the increases are sickening but the alternative fixed rate was not palatable and they were the cheapest in the market at the time. I'd be more annoyed if I had fixed for a year and was coming off now at the higher rate, but perhaps someone knows if I'm blissful in my ignorance?
So did we...what a few months that was!
Ah nice to see someone showing the same prudence as the bankers did with their lending criteria in the boom times, supported by the central bank, regulator and government........oh wait.
The official AIB/EBS justification for the rate increase has a rather hollow ring to it. The need to put their mortgage lending on a sustainable footing has been driven not so much by the need to cut their costs and bring rates into line with competitors, as the requirement to backfill the catastrophic losses created by their rush to promote trackers (essentially a marketing strategy that aimed to grow market share, but in essence was always of marginal commercial value to the banks).
The EBS - originally a mutual society created to fund the purchase of homes by working people - took a punt on commercial lending. It got it wrong and now it's customers and the Irish people in general are picking up the tab. The EBS and AIB made a call in terms of promoting tracker mortgages - again they got it wrong - and this time a sub-set of their customers are paying the price.
The term usury springs to mind - defined as "The illegal action or practice of lending money at unreasonably high rates of interest." At a time when ECB rates are at historically low levels - unreasonable would accurately describe a European bank's decision to move its rates in the opposite direction.
The EBS - originally a mutual society created to fund the purchase of homes by working people - took a punt on commercial lending. It got it wrong and now it's customers and the Irish people in general are picking up the tab. The EBS and AIB made a call in terms of promoting tracker mortgages - again they got it wrong - and this time a sub-set of their customers are paying the price.
The term usury springs to mind - defined as "The illegal action or practice of lending money at unreasonably high rates of interest." At a time when ECB rates are at historically low levels - unreasonable would accurately describe a European bank's decision to move its rates in the opposite direction.
I agree with you. But what can we do about it? Already, this issue appears to be forgotten about. There was a bit of negative press for about 24 hours after the announcement, but that seems to be it now, all forgotten about.
I suppose we could all write to our local TDs asking the government to intervene. But is that going to result in any action? Unlikely.
I would be interested to hear what people have done/are planning to do to protest/fight these interest rate increases.
I've already written to my local Fianna Gael td and so far no reply. I see no point in writing to AIB / EBS as they don't give a damn, they'll do what they can get away with & and this government seems to let them away with everything. I am in the process on moving my current a/c from AIB in protest ---this is the only form of protest they will understand-where it hits them in their pockets.
You will have a hard time getting traction for any specific protest against AIB/EBS. It is not like they are outliers. Should BoI customers be protesting too? They pay the same SVR as AIB customers (in fact slightly more).
The rates are now much of a muchness. And that does not a solid platform for a campaign make.
Morgan Kelly foresaw some of the "conflict" that would occur between varying categories of mortgage holder (no one else seems to have any interest even now). There are several categories of mortgage holder, and those currently on SVRs are going to be bled to compensate for those on trackers and any other borrowers costing the banks, such as those in arrears and/or those who will have debt restructured.
Also, there are people who cannot or will not pay their mortgages - these obviously cost the banks money. If banks are facing losses (some government imposed by virtue of being directed to act in certain ways to the benefit of those in a specific mortgage category) they are going to seek ways to offset them. And guess who is a good source of money? Those on trackers? Those in arrears or interest only? Those in MARP? No - it's you and your SVR.
People tend to view all the subtopics of the current mortgage crisis as separate, when they are connected. The issue of repossessions and debt restructuring are quite relevant to someone's SVR rate, whether the borrower recognises it or not.
If you are in arrears there has been huge government pressure to allow you time to recover. If you cannot meet your mortgage repayments and other debts there is pressure for you to retain your family home (remember, repossession is a "last resort") and get your debt restructured and maybe even written off.
But if you're paying your SVR dutifully each month? You might as well paint a target on your bank, and the government (or any politicians) don't give a damn.
The rates are now much of a muchness. And that does not a solid platform for a campaign make.
Morgan Kelly foresaw some of the "conflict" that would occur between varying categories of mortgage holder (no one else seems to have any interest even now). There are several categories of mortgage holder, and those currently on SVRs are going to be bled to compensate for those on trackers and any other borrowers costing the banks, such as those in arrears and/or those who will have debt restructured.
Also, there are people who cannot or will not pay their mortgages - these obviously cost the banks money. If banks are facing losses (some government imposed by virtue of being directed to act in certain ways to the benefit of those in a specific mortgage category) they are going to seek ways to offset them. And guess who is a good source of money? Those on trackers? Those in arrears or interest only? Those in MARP? No - it's you and your SVR.
People tend to view all the subtopics of the current mortgage crisis as separate, when they are connected. The issue of repossessions and debt restructuring are quite relevant to someone's SVR rate, whether the borrower recognises it or not.
If you are in arrears there has been huge government pressure to allow you time to recover. If you cannot meet your mortgage repayments and other debts there is pressure for you to retain your family home (remember, repossession is a "last resort") and get your debt restructured and maybe even written off.
But if you're paying your SVR dutifully each month? You might as well paint a target on your bank, and the government (or any politicians) don't give a damn.