Fianna Fáil Spokesperson on Finance, Michael McGrath TD has said that, based on today’s Central Bank publication on mortgage switching, over 150,000 mortgage holders would save money by switching their mortgage to another lender.
Deputy McGrath commented, “In truth, the measures announced by the Central Bank today are very modest. However, the new measures may help to raise awareness of the very significant savings thousands of mortgage holders could make if they switched their mortgage. Banks in Ireland are benefitting from the inertia of some consumers and collectively we need to change this.
“With almost 730,000 principal dwelling home mortgage accounts in Ireland, the finding in today’s research – based on a large sample – that some 21% of borrowers could save money by switching means that over 150,000 mortgage holders are paying more every month than they need to.
“I would urge every all mortgage holders to examine what interest rate they are on and whether they could get a better deal. This is especially true for variable rate and even some fixed rate customers.
“The Central Bank could have gone a lot further today. They have acknowledged that people ‘find it difficult to compare mortgages’ and yet they continue to allow banks to offer ‘cashback’ incentives that dazzle consumers.
“These incentives make it even more difficult for consumers to compare mortgage offers across lenders and these headline offers have provided cover for banks to continue charging Irish consumers the highest interest rates in the Eurozone.
“Fianna Fáil supports the removal of these ‘incentives’ and we will be seeking support from across the Oireachtas to give effect to this.
“Further, the Central Bank continues to tolerate a situation where not all lenders in the Irish market allow consumers to move to a cheaper interest rate with their existing bank as a result of an improvement in their loan to value ratio. This issue also needs to addressed if we are genuinely interested in achieving fairness for Irish mortgage holders,” he concluded.