Home loan rates hit a new low as Ulster Bank offers 2.2% deal

A MORTGAGE price war saw the cost of home loans dragged to a new low yesterday.

Irish borrowers are now starting to be offered European-style deals, with Ulster Bank slashing the rate on its fiveyear fixed mortgage to 2.2% – which it claims as the ‘lowest rate on offer in Ireland’.

The rate will be available to first-time buyers, home movers and switchers who take out a mortgage of €300,000 or more and who have at least a 20% deposit or 20% equity in their home.

Someone with a €300,000, 4% mortgage will cash in to the tune of more than €270 a month.

Ulster Bank’s Head of Home Buying and Ownership, Lorraine Costelloe, said: ‘We understand customers need greater repayment certainty and security for longer. That is why we have introduced another market-leading rate, this time a ten-year fixed rate, to continue to meet our customers’ needs in a meaningful way.

‘By offering lower fixed rates, we are providing real support for customers at one of the most crucial financial moments in their lives.’

The price comparison site bonkers.ie said a slowdown in the property market has fuelled competition among the lenders, forcing them to offer the cheapest ever deals to attract wary borrowers.

Average rates for five-year, ten-year and even 15-year mortgages are all at the lowest level on record, while two-year fixed rates are close to record lows.

Bonkers.ie spokesman Daragh Cassidy said: ‘Despite today’s announcement, we shouldn’t lose sight of the fact that mortgage rates in Ireland are still the second highest in the Eurozone after Greece and roughly double what they are in many other Eurozone countries.’

But Karl Deeter, of Irish Mortgage Brokers, said: ‘‘This the first Europeanpriced mortgage we’ve seen since the Celtic Tiger.’