Following our recent Good Financial Housekeeping “To fix or not to fix” post, PIBA (Professional Insurance Brokers Association) put out the following press release on 8th August:-
Broker group PIBA has advised mortgage holders – except those on tracker rates – to consider fixing their mortgages now, as the banks start another cycle of rate hikes.
Bank of Ireland announced last week that it would increase variable rate mortgages by 0.45 per cent from Wednesday.
The bank cited pressure on the cost of funding as the reason for the hike. However, it said it would not increase rates further this year, unless the European Central Bank raised rates.
Rachel Doyle, director of PIBA mortgage services, said consumers should be in no doubt about the future. ‘‘Variable and long-term fixed rates are both on the rise, so delaying a decision maybe costly,” she said.
Doyle advised people generally to fix for at least five years.
‘‘Fixing at a good rate for longer terms gives security and enables better planning. Shorter term fixing could leave you exposed to a large jump in repayments within a relatively short period.”
The latest Central Bank figures for new mortgage lending showed that, in the first quarter of this year, fixed-rate mortgages accounted for 26 per cent of the market.