Irish homeowners with a €300k mortgage being repaid over 30 years are paying €229 more a month than their euro area counterparts, according to figures released today by the Brokers Ireland group.
Pointing to the latest Central Bank report on retail interest rates for December 2019 the representative body for 1,200 general insurance and financial brokers throughout Ireland said this means Irish mortgage holders are paying 1.51% more in interest than the euro area average, a difference that equates to €82k more over the lifetime of a mortgage
In new figures published today the group claimed that an Irish mortgaage holder with a €300k mortgage on a 2.88% interest rate woud pay a total of €448,372 over the lifetime of the mortgage. The same mortgage on the euro area average rate of 1.37% would cost a total of €366,030 - €82,342 less than their Irish counterparts.
|Country||Loan Amount||Term||Rate||Monthly Payment||Annual payment||Overall Payment|
|Euro area||€300,000||30 years||1.37||€1,016.75||€12,201||€366,030|
Rachel McGovern, Director, Financial Services at Brokers Ireland which represents 1,250 Broker firms, said Irish rates were unjustifiable.
“This is not just bad for consumers, it is ultimately bad for lenders too because over time consumers are likely to migrate to or find newer developing forms of borrowing.”
Ms McGovern said the money foregone by Irish borrowers was also impacting pension planning and children’s education.
Encouraging mortgage holders to be alert to the value of switching Ms McGovern said many mortgage holders are now coming to the end of a five-year fixed interest rate period and there is much better value to be got by switching.
“Most lenders offer a lower interest rate where there is a better LTV (loan-to-value) ratio. But consumers need to be proactive in seeking out a better rate from their lenders,” she said.