Permanent TSB, ICS Mortgages and Finance Ireland are the latest lenders to hike their mortgage rates.
Since last July the European Central Bank (ECB) has embarked on the fastest pace of monetary tightening in its history, raising rates from 0% to 4% in less than a year.
But until recently, most variable-rate customers, at least with the main lenders, have been spared the full brunt of the rate hikes.
But with the ECB hiking rates yet again in June, lenders are now passing on the rate increases to their variable-rate customers too.
Permanent TSB
PTSB is hiking its standard variable rate by 0.35 percentage points to 4.30%.
Its managed variable rates, which are linked to each customer’s loan-to-value ratio, will go up by between 0.05 and 0.40 percentage points and will now range from 3.80% to 4.30%.
The new rates come into effect from 31 July.
This is the first time PTSB has hiked its variable rates since the ECB started hiking rates last year. However the lender's variable rates (along with Bank of Ireland's) were extremely high to begin with, so it always had room to absorb some of the ESB rate hikes as it were.
But with the ECB’s main lending rate now at 4%, it was only a matter of time before PTSB hiked its variable rates. And to be honest, even after the hike, its rates are still pretty competitive.
If you’re on PTSB’s standard variable rate, and have €200,000 remaining on your mortgage, you’re looking at paying about €35 extra a month. So it’s not a huge increase, but unfortunately more hikes are probably likely over the coming months.
PTSB has said that its fixed rates for new and existing customers won’t change for now.
These range from 3.90% to 4.90% at present depending on the length of the fixed term and the loan-to-value ratio.
ICS Mortgages
Non-bank lender ICS is also hiking its rates by another 0.25 to 0.30 percentage points.
The new rates will come into effect from 1 August.
Unlike PTSB, ICS has hiked its variable rates several times over the past year and some are now as high as 6.40%.
Non-bank lenders like ICS raise most of their funds for lending on capital markets so are much more exposed to rising interest rates than lenders such as AIB, BOI and PTSB which can use their deposits from savers to lend more cheaply.
Finance Ireland
Non-bank lender Finance Ireland is also hiking its rates by another 0.25 percentage points.
The new rates will come into effect from 26 July.
Like ICS it has upped its variable rates several times over the past year and some are now approaching 7%!
Comparison of new variable rates
|
Loan-to-Value |
PTSB |
ICS |
Finance Ireland |
|
<60% |
3.80% |
6.25% |
6.45% |
|
<70% |
3.90% |
6.25% |
6.45% |
|
<80% |
4.30% |
6.40% |
6.45% |
|
<90% |
4.30% |
6.40% |
6.65% |
Other lenders
AIB and its subsidiary Haven have hiked their variable rates by just 0.35 percentage points so far, which came into effect in March. And their variable rates are the most competitive in the market by far. Some are still as low as 3.10% for example.
But this is unlikely to last for much longer. So expect big hikes over the coming weeks if you're a customer of either lender.
Bank of Ireland’s main variable rates are much higher at between 3.90% and 4.50%. These rates haven’t changed at all over the past few years. But with the ECB likely to hike its main lending rate as high as 4.25% or 4.50% over the coming months, it’s almost a given that there’ll be some changes to Bank of Ireland’s variable rates eventually.
