Irish homeowners are facing mortgage repayment hikes of €300 a month after one lender raised their interest rates by up to 2%.
The new rates from Finance Ireland will come into effect within days as mortgage holders have been issued an urgent warning. Approved applicants have been given before close of business on Friday to draw down their mortgages.
The firm said its 20-year fixed rate mortgage will be priced from 4.6% to 5% depending on the loan-to-value percentage band. Over 80% of the company's loan applications in the past year have been for fixed terms of 10 years or more as customers look to lock in certainty in a concerning time for interest rate increases., a spokesperson said.
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They added: "Overall, we have funded strong mortgage volumes through this year, however these interest rate increases we are implementing are a direct result of significant increases in funding costs over recent months."
Darragh Cassidy of Bonkers.ie told The Irish Sun the decision was "particularly damaging" for switchers because Finance Ireland went from being one of the cheapest lenders to one of the most expensive within a week.
He added: "Customers could have to pay an extra €300 a month on their mortgage, that’s a significant amount of money."
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