Permanent TSB and NIB cut interest rates

IRELAND’S largest provider of residential mortgages, Permanent TSB, and National Irish Bank cut interest rates yesterday.

Permanent TSB announced a cut of 0.5% in it’s standard variable mortgage rate. The move follows the recent decision by the European Central Bank (ECB) to reduce rates by the same amount (0.5%). Following the reduction, the standard variable rate from Permanent TSB will be 4.2% for existing customers. The move will mean a saving of 40.39 per month for a customer with a mortgage of 150,000 over 20 years. Mortgage repayments made after December 30 will reflect the new rate.

The bank has also announced the creation of a two-year fixed rate term with an interest rate of just 3.99% for new borrowers. This is the cheapest two-year fixed rate mortgage on the market. Permanent TSB head of marketing Niall O’Grady said the new rate gives new customers the longer-term security of lower repayments: “Many first time buyers are looking to have their monthly payments secured on a low rate for the medium term.

“The traditional one year fixed rate does not match this need so we have decided to offer customers the chance of locking in to this low interest rate environment for a two year period instead.”

National Irish Bank has cut its mortgage and savings interest rates, a week after the European Central Bank cut its key lending rates. The bank said interest on fixed rate mortgages will be cut by between 0.60% and 0.65%.

The new rates will come into effect from close of business today. NIB’s Tracker Mortgage has already moved in line with the ECB, changing on Friday last.

AIB announced a cut in its mortgage rates on Tuesday, while Bank of Ireland and First Active also lowered their rates this week. IIB Homeloans cut its rates on Thursday last, following the ECB’s move within hours.