No changes in Ulster bank rates

[renter45]

other then expiry now 30 June, rates wef 1.2.19

https://www.ulsterbankintermediaries.ie/product-rates/fixed-rate-mortgages

So mortgage war has hit the floor as far as rates are concerned??

 

[RedOnion]

So mortgage war has hit the floor as far as rates are concerned??

I'm not sure that we're there just yet.
There was a slowdown in lending towards the end of the year, so when banks announce their year end results they might have to take measures to solidify market share.

UB roll their rates every 6 months because of how they fix durations, but their rate changes don't always happen on the same date.

If anything is going to happen re rates this year, it'll happen in March. (In my opinion - I do not work in mortgages, and have no inside info from any bank).

 

[Coldwarrior]

I'm not sure that we're there just yet.
There was a slowdown in lending towards the end of the year, so when banks announce their year end results they might have to take measures to solidify market share.

UB roll their rates every 6 months because of how they fix durations, but their rate changes don't always happen on the same date.

If anything is going to happen re rates this year, it'll happen in March. (In my opinion - I do not work in mortgages, and have no inside info from any bank).

Can I ask why you think there may be movement in March? Switching to Ulster currently and should be complete around then, could drag it out longer if I thought rates would drop more but can't really see Ulster going lower as they are the most competitive at the minute.

Glad to see their fixed date extended again though, means an extra 3 months fixed.

 

[RedOnion]

Can I ask why you think there may be movement in March?

AIB announce annual results in 1st March. BOI the week prior.
If they didn't meet lending targets / market share, they might do something before AGM.
If not then, we won't see any big move this year.

I can't see you doing any better with UB than current 2.3% 2 year fixed.

 

[renter45]

Coming off fixed rate at start of june so have contacted UB and will give EBS a ring. Not sure whether to take the 3% cashback & fix for the 5 years @ 3% or gamble on the UB 2 yr 2.3% and hope intrest rate hasn't passed 3% in 2 yrs time.

 

[skrooge]

Coming off fixed rate at start of june so have contacted UB and will give EBS a ring. Not sure whether to take the 3% cashback & fix for the 5 years @ 3% or gamble on the UB 2 yr 2.3% and hope intrest rate hasn't passed 3% in 2 yrs time.

The difference in interest payments between 3% and 2.3% is a little less than €60 a month per €100k borrowed. How big is your mortgage? There are fixed costs (solicitors fee) associated with switching your mortgage. So the smaller the mortgage the less the net benefit from the cashback and greater the importance of rate differential

 

[renter45]

The difference in interest payments between 3% and 2.3% is a little less than €60 a month per €100k borrowed. How big is your mortgage? There are fixed costs (solicitors fee) associated with switching your mortgage. So the smaller the mortgage the less the net benefit from the cashback and greater the importance of rate differential

€285,000 over 25 years.

 

[skrooge]

Coming off fixed rate at start of june so have contacted UB and will give EBS a ring. Not sure whether to take the 3% cashback & fix for the 5 years @ 3% or gamble on the UB 2 yr 2.3% and hope intrest rate hasn't passed 3% in 2 yrs time.

€285,000 over 25 years.

Looking at the numbers:

• ignoring the cashback offer & cost of switching. Over the five year time horizon you would pay less interest staying with UB as long as their mortgage rates were less than 3.5% in years 3-5.
• That changes considerably when you factor in the cashback. The break even rate (below which makes sense to stay at UB above which EBS costs less) is 2.4% in years 3-5.
• Factoring in switching costs of €1500 the break even rate increases slightly to to 2.6%.

In effect the benefits of UB disappear if ulster banks variable mortgage rate or 2 year fixed rate (in 2021) are above 2.6%. That's only 0.3% over their current best rate on the market. EBS and the cashback option would seem to win out here.

Another option worth exploring is the multiple switch option given your mortgage balance. BOI and PTSB offer % cash back also. If you're willing to get multiple approvals and jump from bank to bank you could be even better off.