Mortgage holders could be in line for further rate reductions in the coming months following the announcement by Ulster Bank that it is to cut its rates – Peter O’Dwyer
The bank yesterday waded into the mortgage price war after announcing reductions to its fixed and variable interest rates.
Ulster becomes the latest major player in the banking sector to announce rate decreases which started with AIB in October of last year and has since been followed by Bank of Ireland and Permanent TSB, among others.
The move signals the arrival of a legitimate price war given the involvement of the leading lenders in recent months and could precipitate further decreases, ac-cording to Simon Moynihan of Bonkers.ie.
Among the changes announced yesterday is a 0.2% reduction in the standard variable rate to 4.3%.
The bank also announced the launch of a new 60% loan-to-value (LTV) fixed rate range.
"The addition of a new LTV in our range offers a wide range of choice both to new and existing customer sand is a further example of how we are aiming to be number one for customer service," said Ulster Bankhead of branch banking, Jim Ryan.
The three-year fixed rate for LTV below 90% is to fall from 4.25% to 3.85% with the corresponding five-year fixed rate decreasing to3.90% from 4.35%.
Last month, PermanentTSB announced a series of cuts of between 0.35% and0.42% which were followed a day later by cuts to Bank of Ireland's mortgage products.
Unlike some of its rivals, yesterday's cuts applied to both new and existing customers.
Both PTSB and BOI faced criticism from the Irish Brokers' Association which claimed at the time that existing customers were being left out in the cold while Fianna Fail TD Michael McGrath labelled it as deeply unfair.