This new 10 year fixed rate says a lot about what KBC think is likely to happen with interest rates over the next 10 years.
As a matter of interest, do KBC allow mortgage over-payments for fixed rate customers?
They must be betting on rates going down more. Seems to be a price war at the moment which is good for all of us mortgage holders. What is the most they will drop can't go lower than 2.5% but question is what is the most they can rise they definitely can rise again to 3.5% 4% and the rest. Only God knows what is going with happen post brexit-and the future of the EU
Not at all. KBC will fully hedge this in the market, with swaps maturing out to 10 years based on their modelled repayments. The 10 year swap rate is about 0.88% at the moment.This new 10 year fixed rate says a lot about what KBC think is likely to happen with interest rates over the next 10 years.
As a quote from KBC, this does not surprise me. KBC have shown in the last few years that they do not always offer new and existing customers the same rates, and therefore many now treat them as an upward only variable rate option. Fixing is a better option in this case, and they should compete head to head with BOI. I do accept that KBC currently does have the existing customer offer, but there is no guarantee this will continue into the future. It is also worth noting that on the existing customer offer (at least), the customer would roll over onto new business rates when the fixed term expires. I imagine brokers are now wise to the way KBC work, and are advising customers accordingly.We are seeing strong demand from customers who want to fix their mortgage repayments and this has increased significantly this year.
I agree it would be an interesting comparison, but probably not a valid one. We all accept that repossessing properties here is a difficult ask, as well as the practice of paying to switch rather than the mortgage holder paying an arrangement fee. We need to be conscious of this in any comparisonIt would be very interesting to get a comparable rate for 10 years <60% in some other eurozone country.
I reckon it's still about 0.5% too high. But that is not as big an overcharge as others.
KBC have free banking if you lodge 2500 in each month (Extra Current Account). You could simply bounce your salary though that account to PTSB and use the KBC one as a psuedo cash-save account if you wished. Depending on the size of your mortgage, that 0.2% is valuable. On a 250k mortgage over 25 years it is 325 euro a year in extra interest paid. That's a meal out once a quarter or a hotel break once a year, and much better in your pocket than KBC's.I'd like to keep my transaction-free current account with PTSB.
But the question is - will they reduce their variable rates any mroe? Or is that it for the foreseable future?
Seems to be a price war at the moment which is good for all of us mortgage holders. What is the most they will drop can't go lower than 2.5% but question is what is the most they can rise they definitely can rise again to 3.5% 4% and the rest.
I also don't see 2.5% as the floor. Look at the rest of Europe.
That has be be priced into rates here so can't see it going below 2.5 unless the courts start to change which won't be happening any time soon
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