Bank of Ireland has announced that it is cutting the interest rate on its four-year fixed-rate 'green' mortgage, which will appeal to those seeking to buy energy-efficient properties.
We’re all taking the necessary steps to conserve energy and do our bit for the planet. For mortgage seekers, this desire may even extend to searching for an energy-efficient home.
That’s where green mortgages come in. This type of mortgage rewards you with a better mortgage rate for opting to purchase an energy-efficient property.
There are green mortgages on offer from numerous lenders in Ireland, and Bank of Ireland is no exception. In fact, the lender has just announced a cut to its already-competitive green fixed mortgage rate.
Here we take a look at what’s on offer from Bank of Ireland (BOI), but before we jump in let’s have a recap on what a green mortgage is.
What is a green mortgage?
Green mortgages offer a lower interest rate to those who are buying a more energy-efficient home. The lower interest rates is an incentive for homeowners to buy a home with a higher Building Energy Rating (BER).
Usually, to qualify for a green mortgage, you need to purchase a home with a BER of at least B3 or higher.
You can learn more about what a green mortgage is in this guide.
What’s on offer from Bank of Ireland?
Having launched Ireland’s first green mortgage in 2019, Bank of Ireland came out with a new competitive fixed-rate green mortgage in October last year for those looking to buy an energy-efficient home. The bank offered a four-year fixed-rate of just 2%.
Now the lender is further reducing this competitive rate by 0.10% to just 1.90% - the lowest in Ireland.
The four-year fixed-rate is available for new customers borrowing €250,000 or more and who are buying or building a home with a Building Energy Rating (BER) of B3 to A1.
As well as reducing its green four-year fixed-rate, BOI is also cutting its four-year fixed-rate High-Value Mortgage by 0.10%. This will decrease from 2.30% to 2.20%. Similarly to the green rate, mortgage seekers must be looking to borrow at least €250,000 to avail of this rate.
Energy-efficient homes
Green mortgages have proven to be a popular choice for BOI customers, and they accounted for around 35% of the bank’s mortgage lending in 2021.
Speaking about the new rates, Alan Hartley, Director of Home Buying at Bank of Ireland said:
“Homes that are easier to heat and keep warm are good for your pocket and good for the environment. Encouraging customers to make these choices is one of the clearest ways that Bank of Ireland can support the transition to a low carbon future.”
The future of the Irish mortgage market
Bank of Ireland’s decision to cut certain mortgage rates has come as somewhat of a surprise, albeit a good one.
Last week, ICS Mortgages also made an announcement regarding rates, however the non-bank lender increased a variety of fixed rates instead. This move sparked concern that more lenders would increase interest rates.
There is talk of the European Central Bank increasing its key lending rate by the end of the year due to the current global rates of inflation. However, any interest rate increases are likely to be small and gradual.
You can learn more about inflation and the prospect of rising interest rates in this blog.
Compare mortgage rates on bonkers.ie
Despite valid concerns about rising interest rates, the Irish mortgage market remains relatively competitive.
If you’re searching for the best interest rate to suit your circumstances, why not run a mortgage comparison search on bonkers.ie? It’s quick and easy!
Our mortgage calculator lets you compare mortgage interest rates, cashback offers and incentives from lenders nationwide.
Better still, when you find the right mortgage for you, you’ll be able to complete your mortgage journey with us through our mortgage broker service.
Our mortgage broker service is 100%, fully digital and paper-free!
As well as helping you with your mortgage, we offer a range of services on bonkers.ie. We make it easy for you to compare prices and deals for energy, broadband, insurance products and other banking services. Take control of your household bills today.
Helpful mortgage blogs and guides
If you’re starting your mortgage journey, we have a range of helpful mortgage articles that will aid you on the way:
- Discover how your mortgage application will be assessed in this guide.
- We compiled a list of answers in this guide for the 13 most commonly asked mortgage questions.
- Unsure whether to go for a fixed or variable rate? Here we look at the pros and cons of variable and fixed-rate mortgages.
Check out our mortgage blogs and guides, which will help you make an informed decision.
Get in touch
Are you happy to hear the news from Bank of Ireland? Would you consider purchasing an energy-efficient home for a cheaper interest rate? Let us know in the comments below or get in touch with us on Facebook, Twitter, and Instagram.
