Good news for hard-pressed mortgage holders as Ulster Bank undercuts the competition again.
Ulster Bank has introduced a new five-year fixed rate of just 2.20%, the lowest rate now on offer in Ireland, and the latest in a series of rate reductions in recent months by the bank.
The rate will be available to first-time buyers, home movers and switchers who take out a mortgage of €300,000 or more and who have at least a 20% deposit or 20% equity in their home.
If your mortgage is less than €300,000, or you only have a 10% deposit, you'll have to make do with Ulster Bank's other, slightly higher fixed rates, but these are still highly competitive. For example, Ulster Bank also offers a 2.30% fixed rate over two years and a 2.60% fixed rate over five years.
Nevertheless, despite today's announcement and recent mortgage rate reductions from other banks, mortgage customers in Ireland stil pay among the highest rates in the Eurozone according to the Central Bank. The average rate on a new mortgage issued here in November was 2.90% - way above the 1.37% average in Europe!
New 10-year fixed rate
Ulster Bank has also become the latest lender to offer Irish mortgage holders the choice of a fixed rate over 10 years.
Ulster Bank will offer a market-leading, 10-year rate of 3.15% to first-time buyers and 2.95% to home movers and switchers or first-time buyers with a 20% deposit. Slightly higher rates will apply though if someone is seeking an exemption to the Central Bank’s loan-to-income rules.
Up until recently very few lenders offered the option of a fixed rate for longer than five or seven years. But Ulster Bank now joins Haven, KBC, Bank of Ireland and AIB in offering mortgage customers the choice of a fixed rate over 10 years.
The question now is whether any lenders will start offering even longer-term fixed rates of 12 or even 15 years like in the rest of Europe. While unlikely in the very short term, we could see it introduced within the next few years, especially if a new lender enters the market as is rumoured!
What are Ulster Bank's mortgage rates?
Here's a selection of some of Ulster Bank's most competitive rates.
| Type | LTV | Rate | Note |
| 2-year fixed | ≤90% | 2.30% | |
| 4-year fixed | ≤90% | 2.60% | |
| 5-year fixed | ≤60% | 2.20% | €300k loan or above |
| 5-year fixed | ≤80% | 2.20% | €300k loan or above |
| 10-year fixed | ≤60% | 2.95% | |
| 10-year fixed | ≤80% | 2.95% | |
| 10-year fixed | ≤90% | 3.15% |
When are the new rates available?
Ulster Bank will start offering the new rates from 17th January to first-time buyers, home movers and switchers and both new and existing customers. So if you’re currently with Ulster Bank then give them a call to see what options are available to you.
To fix or to vary?
Over the past few years fixed rates have become increasingly common in Ireland, so much so that over 70% of new mortgages here are now fixed. However this compares to over 80% in the Eurozone. And in Europe, fixed rates of up to 20 years or more are common!
Unsure whether to fix or vary? See here for more info on the pros and cons of fixed versus variable rates.
Anything else?
On top of these rates, Ulster Bank continues to offer €1,500 cash towards customers' legal fees as well as free valuations, which would normally cost around €150, on all new mortgages.
Customers of Ulster Bank can also choose to make overpayments on their fixed-rate mortgage by up to 10% a year if they wish. This means not only do you get peace of mind that your mortgage repayment will remain the same for the term that you choose, but you’ll also have the flexibility to pay more off your mortgage, and therefore save on your interest bill, should your personal finances improve.
What’s more, Ulster Bank mortgage customers can also avail of a free online service that gives them more control over their mortgage. Manage My Mortgage claims to be the first online portal of its kind in Ireland and allows existing customers to make lots of changes in relation to their mortgage quickly and easily online.
Customers can:
- Set up a regular overpayment on their mortgage
- Make a lump sum overpayment
- Change their payment date
- Change their payment bank account
- Request a Certificate of Interest
- View their current mortgage balance
- Check their loan-to-value amount
- Switch to a new product and more!
Before you decide, always compare
Although the new rates from Ulster Bank might seem competitive, make sure you compare all rates across all lenders on bonkers.ie before you commit with our free, easy-to-use mortgage calculator.
