Thursday, 11 June 2009

New fixed rate for First Time Buyers

ICS have announced a new two-year fixed rate at 2.75% (APR 2.7%) which is available only to First Time Buyers. AIB already have a two-year fixed rate just five basis points higher at 2.8% (2.84%) for all mortgage customers, First Time Buyers, trader-uppers, those switching lender etc.

At around €410 per month per €100,000 borrowed over 30 years before tax relief, these rates seem like a reasonable bet for someone who wants a bit of security for the next couple of years.

That said, I will repeat two of my old mantras about fixing - (1) Don't fix in an attempt to beat the variable rate, unless you really believe you know more than the bankers. Predicting the long-term movement of variable rates is well-nigh impossible. Fix if you want the peace of mind of knowing what your repayment will be and then forget about it. (2) Don't Don't DON'T give up on a good tracker variable rate to avail of a fixed, unless you're very close to the end of your mortgage term. Chances are you'll never get your tracker rate back and the variable rate options at the end of your fixed period may be far higher than the tracker you have now.

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