Only two financial institutions in the country will accept mortgage switchers, leaving thousands of homeowners caught in their current arrangement.
It has been reported that AIB, which has the lowest home-loan rates in the market, has confirmed that it no longer accepts mortgage switchers.
The move will come as a fresh blow to mortgage holders currently with Halifax, which is due to close its retail operations here.
It will also be bad news for those who have a loan with Permanent TSB as it has increased its mortgage rates twice in the past six months.
Permanent TSB shocked homeowners this month when it pushed up its standard variable rate for existing customers by 0.5pc.
AIB's rate remains one of the lowest in the country, with a standard variable rate of as low as 2.25pc and a three-year fixed rate of 3.19pc.
In comparison, Bank of Scotland (Ireland)/Halifax has a three-year fixed rate of 7.25pc.
The news leaves KBC Homeloans and EBS Building Society as the only ones who will now transact switcher mortgages.
However, these lenders have strict lending criteria making their switcher mortgages difficult to quality for.
KBC will only accept switchers who are borrowing less than 80pc of the value of the home.
Bank of Ireland confirmed that it would accept a mortgage switch from people who were not customers only if they were borrowing less than half the value of the home.
Up to 350,000 mortgage holders have standard variable rates, which lenders are free to increase when they want.
Some mortgage experts expect standard variable rates to rise by up to 1pc this year.
Separately it has been revealed that analysts with French bank Societe Generale estimate Allied Irish Banks needs to raise €4.4bn and Bank of Ireland an additional €2.7bn to bring their equity capital levels up to standards set by the international markets.
The French broker estimated that AIB will write down €13.6bn of its loan book, including discounts on its NAMA-bound portfolio, over the worst four years of the crisis and it said that BoI's provisions should hit €10.9bn in the same period.
It warned that the speed at which Irish banks will be able to increase their margins will be slower than UK rivals, as new lending remains more subdued.