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01/06/2015
BoI Slammed For Keeping Standard Variable Rate At 4.5%
The Bank of Ireland (BoI) is being slammed for keeping its standard variable rate at 4.5%.
The bank reduced its fixed mortgage rate, however it is refusing to cut its "ridiculous" variable rate and is instead effectively trying to force existing customers to lock in to a two year fixed rate, according to Fianna Fail.
Finance Spokesperson Michael McGrath said: "Carefully placed media leaks indicated that variable rate cuts of 0.75% were on the way over a period of time. It now looks like the Minister has been duped by the banks. If yesterday's announcement is their complete response to the meeting they held with the Minister, Bank of Ireland is refusing to cut their ridiculous variable rate and is instead effectively trying to force existing customers to lock in to a two year fixed rate. Reducing the fixed rate is not a substitute for reducing the standard variable rate itself.
"Fixed rate mortgages are an entirely different product to a standard variable rate mortgage. If a customer locks in to a fixed rate, and an existing Bank of Ireland customer can only avail of a fixed rate for a minimum of two years, they will lose out again if the variable rate falls below the fixed rate. In addition, if a new competitor enters the market offering a much lower variable rate, the customer will face substantial penalties if they seek to as switch their mortgage."
(CD)
The bank reduced its fixed mortgage rate, however it is refusing to cut its "ridiculous" variable rate and is instead effectively trying to force existing customers to lock in to a two year fixed rate, according to Fianna Fail.
Finance Spokesperson Michael McGrath said: "Carefully placed media leaks indicated that variable rate cuts of 0.75% were on the way over a period of time. It now looks like the Minister has been duped by the banks. If yesterday's announcement is their complete response to the meeting they held with the Minister, Bank of Ireland is refusing to cut their ridiculous variable rate and is instead effectively trying to force existing customers to lock in to a two year fixed rate. Reducing the fixed rate is not a substitute for reducing the standard variable rate itself.
"Fixed rate mortgages are an entirely different product to a standard variable rate mortgage. If a customer locks in to a fixed rate, and an existing Bank of Ireland customer can only avail of a fixed rate for a minimum of two years, they will lose out again if the variable rate falls below the fixed rate. In addition, if a new competitor enters the market offering a much lower variable rate, the customer will face substantial penalties if they seek to as switch their mortgage."
(CD)
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FF Call On Central Bank To Directly Engage With Mortgage Providers
The Central Bank has been urged to engage directly with mortgage providers in an effort to secure a reduction in the standard variable rate. Making the call Fianna Fáil finance spokesperson Michael McGrath said that "it is clear that there is a wide and growing disparity with existing customers on SVRs very much at the bottom of the pile.
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