Ulster Bank cuts mortgage rate to 2.3% fixed for two years - all LTVs

Brendan Burgess

Brendan Burgess

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In addition to these new rates, Ulster Bank is also offering customers:

· €1,500 contribution to legal fees.

· Free valuations.

· Same rates available to new and existing customers.

· 10% annual overpayment allowance on fixed rate products, giving customers both certainty of repayment and flexibility to make large overpayments to save interest.
 
For people borrowing up to 90% LTV, these are huge cuts.

The lowest rate currently from any provider is 2.85% fixed for 4 years from Ulster Bank, so that is a cut of .55%.

It's particularly good news for existing Ulster Bank customers. An UB customer who is in negative equity or arrears who can't switch to another lender can cut their rate to 2.3% for the next two years.

It's also a good cut for those on less than 80% LTV.

The cheapest rate is also from UB at 2.6% fixed for 4 years.

Brendan
 
What is particularly satisfying for the Fair Mortgage Rates Campaign is that these rates are offered to existing customers as well. It shows what lenders can offer if they compete on mortgage rates alone. Other banks give cash back to attract new customers which leave their existing customers stuck on artificially high rates.

Brendan
 
They're huge cuts, far bigger than I thought we'd see anywhere this year. and good to see they've followed BOI and EBS in offering them to all LTV bands. There is absolutely no reason for a customer to be on SVR any longer.

This will put pressure on BOI to react if they want to protect their market share.

The market has quietly got very competitive. The BPFI statistics on mortgage approvals for May were interesting. Year-on-year the 'remortgage' approvals were up over 100%. This contains switchers and equity release. I don't have details but I imagine there is a higher probability of these leading to drawdown than a FTB approval, so we will see higher switcher numbers this year (just over 3,000 switched mortgage in 2017).
 
Wow!

2-year fixed @2.3%, accross all LTVs, with €1,500 cashback and a free valuation - that's a fantastic deal by any standards.

That has to put pressure on other lenders to react - AIB's mortgage products now look very expensive in comparison.
 
And I'm off to switch to UB! I had been interested in the four year fixed but it wasn't as attractive at the rate we are hoping to overpay but this 2.30% rate is excellent. Now to get a discount on the legal fees as this is our third switch!
 
Hopefully we will see competitor price reactions over the coming weeks.

Charlie Weston has an article in then Indo on the rate changes .
 
Have been talking with Ulster about the 4 year but wasn't sure, but this new 2 year rate is a winner in my opinion
 
@Brendan Burgess, any change in the BTL rates?

Reluctant landlord here stuck at UB SVR of 4.3% (unless I get some good news about my tracker case), but also barely out of negative equity so no way I can switch as >70% LTV still outstanding on the mortgage balance
 
Can anyone confirm that they really mean 10% overpayment on outstanding balance? as in 300k mortgage and you can overpay by 30k per year charge free? can it be installments or lump sum?
 
Sybil35 said:
Can anyone confirm that they really mean 10% overpayment on outstanding balance? as in 300k mortgage and you can overpay by 30k per year charge free? can it be installments or lump sum?
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Hi, yes their t&c's allow for 10% of the balance at the start of that year (so in your example 30k in year 1, 27k in year 2, etc). Either lump sum or regular payment are allowed.
 
That's great RedOnion. Also is there a minimum term you need to be with your current bank before you can switch? Still hoping to get a quick switch into EBS for the cash bank and then Ulster.
 
I'm not entirely sure about minimum term. They had talked about accepting switchers after just 6 months, but I don't know if that was with current lender, or in total. There are some posts in the switchers forum from people who seemed to have managed it.
 
@Brendan Burgess
It's interesting to look at the rate movements across lenders since Q1 2017.

In that period, AIB is the only lender to have reduced SVR! Butwe've seen cuts of up to 0.9% on fixed rates (PTSB 5 year) as well as the introduction of new products such as this 2 year from UB.

It's interesting to read the SVR policy statement from each bank in that context...

Some interesting comments from Goodbody, including the impact on bottom line for each bank for a 25bps drop in rates: [broken link removed]
 
Long time lurker, first time poster.

About to switch to UB and now can't decide between the 2.3% for 2 years or the 2.6% for 4 years.

In the first two years, the 2.6% would cost approx €1200 more. But it's difficult to know what rate UB (or other banks) will be offering in 2 years.
 
Sounds too good to be true but if so it might finally move things in just the way this campaign has looked for, not at the euro average but for lots of people a huge reduction and a chance to force the dasterdly banks to finally compete properly. It might shake them but the other thing that needs to happen is switching and lots of it. I'll be on to mine on monday morning.
 
Possibly a daft question but this is all new to. We’ve recently been approved by UB for mortgage and we were looking at fixing for 5 years at 2.9 (LTI 3.8). Can we change our minds and go with this 2.3% for 2 years? We haven’t received or signed any documents.
 
MsCutha said:
Possibly a daft question but this is all new to. We’ve recently been approved by UB for mortgage and we were looking at fixing for 5 years at 2.9 (LTI 3.8). Can we change our minds and go with this 2.3% for 2 years? We haven’t received or signed any documents.
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Yes, you can change. Mortgage approval should not be dependent on choice of variable/fixed rate. After drawdown you should have a cooling off period.
 
Whilst I think it is great news and puts pressure on others - (i believe that ptsb are reducing fixed rates). However I think people should should consider what will happen after two years is up. Where will rates be then?

I'm not a crystal ball expert as we decided to fix a few months ago withwi 10 year at 2.99% with KBC due to our personal circumstances and are natural risk aversion.
 
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