Permanent TSB cuts variable interest rates for some customers as deadline closes
Published 01/07/2015 | 07:04
Permanent TSB is to end standard variable rate mortgage pricing for over 70,000 home loan customers on request, allowing customers on variable mortgages of 4.5pc to move to new mortgage interest rates which will start from 3.7pc.
The bank said that the move could mean savings of up to €10,000 for a homeloan customer with €100,000 mortgage on a home valued at €250,000.
The new rates will vary depending on the amount owed by customers and the current value of their home.
The highest rate charged will be 4.3pc which is 0.2pc less than the current standard variable rate. The highest rate will apply to customers who are in negative equity or whose mortgage is equal to 91pc or more of the value of their home.
In a statement Permanent TSB said the move will mean “an end to the traditional SVR mortgage for homeloan customers that was based on a one-size-fits-all approach where one variable interest rate applied to customers irrespective of how much equity they had in the property.”
The move comes after Finance Minister Michael Noonan had set a deadline of today for banks to respond to his demands for cuts to rates.
Minister Noonan gave another signal last week that he may impose a levy in the budget on banks who don't cut their standard variable mortgage interest rates, saying that he will review progress with the banks before the budget.
AIB had already announced a variable rate cut, by a quarter of a percent to 3.9pc, before a meeting with the Mr Noonan last month, while Bank of Ireland is to reduce its fixed rates but has made no move to cut its variable rate.