I blogged earlier in the month about the closure of Bank of Scotland & Halifax and the negative effect on choices available to Irish mortgage-hunters that this brings.
Now AIB have confirmed that they are no longer open for mortgage switching business, i.e. moving your mortgage from Lender A to Lender B because Lender B offers better rates or a better package.
While AIB's release tells us that their "primary focus for the year ahead will be to support mortgage applications from 'First Time Buyers' and 'Home Movers', I see this move as a bad thing. If other lenders follow suit, Irish mortgage customers are then left in a position where the only way they can move mortgage is to buy another house! Think about it - your lender decides to add 2 or 3% on to your interest rate to boost their own margins and you can do nothing about it because no lender will accept switchers...
Let's hope that not all lenders follow this lead. A market without competition is not a good place to be.
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2 comments:
This is another sign, if one were needed, that our banking sector is dysfunctional and possibly beyond redemption. Unfortunately, it is highly unlikely that AIB made this decision in a vacuum. Presumably they expect the other leading banks to follow suit.
Thanks Tommy. I'm just hoping that in due course history repeats itself and a foreign bank sees an opportunity to cherry-pick Ireland's performing mortgage book. But the experience of Bank of Scotland might make this less attractive than it might have been some years ago.
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