Government must back An Post mortgage plan
Fianna Fail plea to support ‘market shake-up’
PLANS by An Post to offer mortgages to hard-pressed families must be fully backed by the Government, Fianna Fail said yesterday.
The company is planning to enter the market next year and said there will be a cut of 1% on current interest rates.
It means a €300,000 mortgage could save a borrower as much as €60,000 over the lifetime of a 30-year loan.
An Post said it will search for a partner in the coming weeks and will focus on making its mortgages attractive to younger people.
Fianna Fail finance spokesman Michael Mcgrath said: “For some time now, the Irish mortgage market has been badly in need of a major shake-up.
“Consumers are still paying the highest rates in the Eurozone and there has been no sign of any new competition arriving into the market. This is what makes the statement from An Post so significant.
“While the main mortgage lenders in Ireland are spending money on marketing, there is little sign of real competition. “The fact none of the other banks have felt the need to match Ulster Bank’s new 2.3% fixed rate announced last June speaks volumes for the lack of dynamic competition in the market.
“If An Post can deliver a mortgage product at up to 1% cheaper than the existing banks, consumers will be the winner.
“An Post is in a positive position to enter the mortgage market as it does not have to deal with legacy issue such as the tracker mortgage debacle and the high rates of nonmajor performing loans. With the right partner, An Post has the potential to offer an exciting mortgage product and at much cheaper rates than currently available.
“This announcement An Post is most welcome.
“They now need to be given every possible support by Government to make it a reality.”
Last year, An Post rolled out a current account with debit card services and plan to be able to provide credit cards and overdraft facilities. by