AIB raise rates by 1/2%
Aib's loss making tracker mortgage book is once again causing pain for variable rate mortgage holders.
At this stage fixing seems the only sensible option given the uncertainty in the variable rate market.Fixed rates are expensive but at least you know where you are going
AIB customers will see their monthly mortgage repayments increase after the bank raises its standard variable mortgage rates by a half-point next month, the second increase in just over two months.
The bank has said it will raise the interest rates by 0.5 per cent from November 13th.
AIB said it was increasing the standard variable rate on home loans to 4 per cent as it needed to return the bank to sustainability and due to the fact that its mortgage books were loss-making.
A half-point increase means an additional €30 in monthly repayments on every €100,000 borrowed or an increase of €90 a month or €1,080 a year on a mortgage of €300,000.
Customers on tracker or fixed-rate mortgages at AIB, or holders of standard variable rate mortgages at the bank's subsidiary, EBS, will see no increase in their monthly repayments.
There is also bad news for landlords who bank with AIB; the standard variable rate on buy-to-let mortgages will also increase next month by a half-point, from 4.45 per cent to 4.95 per cent.