UB reduction in 90% LTV variable rate

RedOnion

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3,132
Still shockingly high, but UB have announced a 0.4% reduction in their variable rate for <90% LTV, down to 3.9%


Anyone who is eligible for their fixed rates should still fix as the difference between the rates is so big.

This could be the first move in a bit of a summer rate shake up amongst the banks, as they haven't all hit the market share they're looking for.
 

Brendan Burgess

Founder
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37,703
I don't get it.

They were charging 4.3% . Now they are charging 3.9%

So what?

Would anyone taking out a mortgage now choose Ulster because they have a variable rate of 3.9% - if they can get an AIB mortgage at 3.15% or 2.85% if they have an LTV below 80%?

If they are an existing customer and thinking of doing something about their rate, then they should fix at 2.3%?

When I heard about this yesterday, I thought it would be of help to those in negative equity who could not switch because their LTV was >90%, but now I see that this is limited to <90% LTV, so it's no help to them either.

Brendan
 

RedOnion

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Optics... Their APR will now be lower.
I wasn't sure if the SVR was included or not - I'm a bit behind with my reading at the moment.

It's actually a good way to prompt people to switch to the fixed rates.
Some people will be delighted to get a letter saying their repayment is reducing by 50 a month. It'd be about 170 per month lower for those people if they switched to the fixed rates with UB.
 

RedOnion

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I thought it would be of help to those in negative equity who could not switch because their LTV was >90%, but now I see that this is limited to <90% LTV, so it's no help to them either
Hi Brendan, I understood that the 2.3% 2 year rate was also available to them as there is no LTV criteria?

Also, remembered they can't reduce their SVR - they've linked all their LTV bands to it, so an SVR reduction reduces everything. They've done the same with this, it's now quoted as 'SVR - 0.4%'
 

Brendan Burgess

Founder
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Hi Red
They are dysfunctional. I advised a borrower in arrears but in plenty of positive equity to switch to the lower rate. When she tried , they refused.

I have told them that this is in breach of the CCMA.

But the priority now is to try to get a restructuring. We will fight the rate battle later.

Mind you, if the rate were reduced to 2.3% it would be far easier to come up with a solution.

Brendan
 

Miley07

Registered User
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12
This could be a big saving to anyone on the loyalty variable rates as it was 1.2% below SVR (3.1 to 2.7% in some cases)
 

RedOnion

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3,132
This could be a big saving to anyone on the loyalty variable rates as it was 1.2% below SVR (3.1 to 2.7% in some cases)
No, and apologies if wording above is confusing - I initially misread it. They have kept SVR untouched, and created a new rate. So it doesn't impact any SVR linked rates.
 

Brendan Burgess

Founder
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37,703
An Ulster Bank spokesperson said:

“Ulster Bank can confirm that, further to offering the lowest fixed rate on the market, it has reduced its variable rate for mortgages with Loan-to-Value between 80% and 90% from 4.3% to 3.9%. This rate will be available to new and existing customers who are in a position to avail of the new rate.”

Background:
•This does not impact our SVR which remains at 4.3%.
•The new rate comes into effect on 11th July.
•Existing customers must be in a position to avail of the new rate i.e. either rolling off a fixed rate; on a variable rate where there are no breakage fees; or opting to break a fixed period, where breakage fees will apply.
•Customers can log onto Manage my Mortgage at any time and review their mortgage and when they are eligible to select a new product, they can review all the products open to them in their LTV band and choose a new product.
•Customers are prompted annually (by letter) on the range of rates available to them

Variable Rate Table:
LTVVariable RateLoyalty Discounted Variable
Up to 60%3.50%3.10%
Up to 80%3.70%3.20%
Up to 90%new 3.90% from 11th JulyWas 4.30%3.60%





Our Loyalty rates are available to Ulster Bank current account customers. Customers must have an income mandated to an Ulster Bank current account.
 
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RedOnion

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3,132
Very interesting.
View attachment 3914
It seems that Their LTV bands stop at 90%. Anything above that is not in a band?

Brendan
No, I think they just screwed up the press release! I think they meant it for new business only.

They seem to be saying the rate is available to all existing customers, but only new customers who don't need an exemption to CBI rules, and trying to apply the same rule (90% max LTV) to existing customers too.
 
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