THE SQUEEZE on homeowners continued yesterday as three more financial institutions announced that they would increase mortgage rates just days ahead of an expected increase by the European Central Bank.
Due to the continued increase in funding costs being experienced across the banking sector, Ulster Bank said it had taken the decision to review its mortgage rates.
From today, its standard variable rate will rise by 0.31 of a percentage point, from 5.79 per cent to 6.1 per cent with an APR of 6.3 per cent. It said the changes to rates would be communicated to customers directly and would be advertised in national press.
The bank’s home loan and investment tracker rates will also increase. The change to tracker rate pricing, which it said does not affect existing tracker rate customers, will come into effect from July 7th. Fixed-rate changes will come into effect from Thursday, July 3rd for new customers.
Ulster Bank’s subsidiary First Active announced similar changes to its standard variable mortgage and said that its tracker and fixed mortgage rates would increase.
Halifax has increased its mortgage rates, which the bank said was the first rate change since May 2007. Until now it had absorbed the increases in wholesale funding through the Halifax channel.
The bank said there would be no change in its existing standard variable rate of 5.05 per cent with and APR of 5.15 per cent but that its one-year fixed rate would rise from 4.75 per cent to 5.58 per cent. The APR on a one-year fixed mortgage would rise from 5.13 per cent to 5.23 per cent, it said.
Tracker mortgage margins are increasnig and the one year discounted element will disappear.
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