Help needed for those on sky-high variable mortgage rates.

TAOISEACH Enda Kenny has no plans to force banks to reduce sky-high variable mortgage rates, beyond asking them to show their customers “a degree of understanding”.

Mr Kenny appeared to be laying the groundwork for a U-turn on the Government stance that it cannot intervene in the day-to-day workings of the banks yesterday, by saying he would put pressure on them to cut variable rate holders some slack and pass on lower European Central Bank rates.

“I expect the banks to do better than they have been doing in respect of variable mortgage interest rates,” he said.

However, his spokesperson said there was “nothing further to add” when questioned last night as to what Mr Kenny would do if banks didn’t reduce home-loan payments.

More than 300,000 families on variable rates are paying interest rates that are four times higher than those on tracker rates.

Showing up Mr Kenny’s weak position, Finance Minister Michael Noonan insisted he has no actual legal powers to allow him to act.

However, Mr Noonan is expected to meet with the Central Bank governor today to discuss the issue.

“I will again speak to the governor of the Central Bank and ask the bank to see what influence they can bring to bear, to bring the variable mortgage rates closer to the cost of funds,” said Mr Noonan.

Variable rates here are more than double those charged elsewhere in the eurozone.

The gap in what is being charged means that a family with 20 years left to pay on a €200,000 mortgage, on a variable rate, is paying €4,000 more a year than a family with a tracker owing the same amount.

And the rates being charged to new mortgage customers are €600-a-year less than to existing variable rate mortgage payers.






Planning Your Retirement- Must see tips

1 Make sure your pension provider has up-to-date details for you

Your pension provider will calculate your benefits based on the details it currently holds on you – in particular, your salary.

Imagine you’re entitled to a pension lump sum of one-and-a-half times your final salary and your provider only has a note of your earnings from years ago – in such a case, your lump sum would be based on that considerably lower figure and you would lose out.

2 Hire an adviser

There’s a perception you can avoid fees and costs by not dealing with a financial adviser, where the opposite may be equally true – you can cost yourself considerably more by not taking advice and making the wrong decision, or missing an option that you simply didn’t know about.

3 Claim your State pension

At up to €219 a week for a 66-year-old, the Irish state pension is one of the best in Europe. To find out how to get it, visit

4 Know your options with defined contribution

With a defined-contribution pension, the lump sum you take at retirement can be calculated in one of two ways.

The first is through a formula based on your salary and service that gives a lump sum equivalent to up to one-and-a-half times your salary. The second is based on the value of your fund where you can take a lump sum equivalent to 25pc of the fund. The first €200,000 of your lump sum is tax-free.

After taking your lump sum, you have a choice of converting the remaining amount into an annuity or an approved retirement fund (ARF – a personal retirement fund where you keep your money invested after retirement). Be aware that if you have taken a lump sum based on the one-and-a-half times salary rule, you are obliged to use the remainder of the fund to buy an annuity – a fixed income for life based on long-term interest rates.

Think about what happens should you die. An ARF can pass onto your spouse, whereas a single life annuity dies with you – don’t find out too late.

Think about inflation, too. Many people invest in ‘level’ annuities – that is, they get a flat amount of income in return for their fund. An annuity of €10,000 will lose over 30pc of its buying power in 10 years if inflation runs at 3pc a year.

5 Make sure your defined-benefit lump sum is calculated in the most advantageous way

Your pension lump sum from a defined-benefit scheme (if you are in one) is based on your salary and service and can be up to one-and-a-half times your ‘final remuneration’.

Ensure your administrator uses the highest possible figure – say you earn €30,000 as salary and you get commission of €30,000 a year. In such a case, the correct one-a-half-times lump sum is €90,000, not €45,000.

Those with defined-benefit schemes should also be careful not to sell their annual pension income for a lump sum. This is definitely one where advice is needed, as you can get very bad value for money if you do so.

More than 22,000 mortgage draw downs in 2014.

More than 22,000 mortgage loans drawn down last year, representing an increase in lending of 48 per cent over 2013, according to BPFI/PwC mortgage market monitor. The highest level of mortgage draw downs seen since 2010.

The figures show mortgages to the value of €1.3 billion were drawn down during the final quarter of last year. This is up 49 per cent on the value of mortgages drawn down in Q4 of 2013, which was €896 million. In comparison, mortgages to the value of €10.3 billion were drawn down in the fourth quarter of 2006.

While there was a 33 per cent increase in house completions in 2014, comparative figures show Ireland’s current house completion rate is well below the European average.

He said relatively low levels of mortgage debt among people under 35 could play a significant role in driving pent-up demand for future housing requirements in Ireland.

#Thrifty Thursday

Looking for a Thrifty Thursday saving tip that could benefit you while waiting to get on the property ladder?

One property management company based in Dublin are offering people a unique chance to live in extraordinary spaces for cut rate rent.

Under the scheme you act as a ‘guardian’ of the vacant property for the owner. The idea is that if the building is occuppied it won’t fall into disrepair and will ward off thieves.

So you could find yourself in a mansion in Dublin 4 for as little as €300 per month.

Follow the link for the full story

Homeowners losing out by under-insuring their property

HOMEOWNERS are losing out on millions of euro worth of insurance claims because they under-insure their houses.

Property owners who scrimp on insurance are left liable for huge proportions of the cost of repair work if they property is damaged. A leading loss assessor has worked out that owners are losing more than €7m a year in claims settlements due to under-insurance.

Manicle Property Claims says some households are deliberately under-valuing their property to save money on premiums.

But they risk being thousands of euro out of pocket if they are unlucky enough to have to make a claim on their insurance due to a fire, a burglary, flood or other mishap.

Loss assessor Sean Manicle said: “We have found in our dealings with homeowners that up to one in five people are under-insuring their home.”

Many people mistakenly insure their house for its market value. Mr Manicle said the property should be insured for what it costs to demolish it and rebuild it, including the removal of debris and professional fees such as the cost of engaging an architect or an engineer.

Another reason for under-insuring was to save money, Mr Manicle, of Kilkenny-based Manicle Property Claims, said.

“Some property owners are deliberately under-insuring their property believing they will save on premiums. However, in reality the savings are often minimal but the serious financial consequences are a lot more severe than envisaged.”

The insurance claims specialist worked out that property owners nationally lost out on more than €7m in 2013, the last year for which figures on claims values have been published by Insurance Ireland.

Mortgage Approvals up almost 60% year on year

The number of mortgages approved in Ireland rose 57.5pc year-on-year in the three months ending in January, the last month before the Central Bank’s new mortgage caps, a new report shows.

The numbers dropped 10pc on the three months leading up to December, but mortgage activity typically drops in January, the report from the Banking and Payments Federation Ireland says.

The value of mortgages approved in the month was €470m, of which €441m was for house purchases.

On average, 2,500 mortgages a month were approved in the period.


Mortgage Arrears Decline For Most

The number of residential mortgage accounts in arrears continued to drop in the final three months of last year, the sixth successive quarterly decline, according to new figures from the Central Bank.

The data show a total of 110,366 residential mortgage accounts – equivalent to 14.5 per cent of all such mortgages – were in arrears at the end of the year, down 6.4 per cent on the previous quarter.

Early arrears declined significantly during the fourth quarter, falling 3.8 per cent to 31,667 at the end of December, or 4.2 per cent of the total stock.

Accounts in arrears over 90 days – equivalent to 10.4 per cent of all residential mortgage accounts – fell by 7.4 percent from October to December to 78,699.

However, accounts in arrears for over 720 days continued to rise albeit at the lowest rate to date. According to the figures, the number of accounts in arrears for more than 720 days increased by 294 in the final quarter of 2014.

The outstanding balance on mortgage accounts in arrears for 720 days or more was €8.2 billion, the figures show.

Buy-to-let mortgage accounts in arrears over 90 days decreased by 7.6 per cent during the fourth quarter; the largest decrease recorded in this category to date. At the end of December, there were 15,386 Buy-to-let accounts in arrears over 720 days, with an outstanding balance of €4.8 billion.

Make another date with us!

We will be at Chelmsford Manor, Celbridge on Saturday 7th March 2015. The showhouse is open 2-4pm.

Come along for a chat with our team representative and have a peek around this exciting new development.

If you’re interested in taking the next step towards buying a property , let us advice you at each stage.

Check out the Chelmsford Manor website for further details –

Mortgage insurance scheme allowing home owners to borrow more may be shelved.

A Government plan to introduce a mortgage insurance scheme to protect banks and allow home buyers to borrow more appears to have been shelved.

Yesterday Mr Noonan said such a scheme could have “a contributory role” to play in delivering an affordable and sustainable housing market, but said the Central Bank’s new mortgage caps are designed to achieve that objective.

The plan would see the Government or private insurers guarantee parts of some mortgages.

In May, Mr Noonan said he thought a temporary scheme for first-time buyers purchasing new houses would be a good idea, and that the Government was hoping to include it in the last Finance Bill.

The Central Bank has warned against introducing mortgage insurance, which would shift risk from banks to insurers.

“From a macro-prudential perspective, mortgage insurance does not remove the risk of a systemic crisis, but shifts this risk from the lenders to the insurers. If this risk is concentrated in a small number of mortgage insurers, or in a State-owned insurer, this could increase the systemic problems in the underlying market,” senior economist Niamh Hallissey wrote.

“This is particularly the case where the insurers are domestic, and the risk and accompanying liability remains within the State.”

The Oireachtas Finance Committee has been examining whether mortgage insurance should be introduced here. Industry experts told the Committee that they were concerned the price of the insurance would be passed on to consumers.

Make a date with us!

Anyone interested in having a chat with us?

We were at the Landen Park showhouse in Oldtown Demesne, Naas last week and will be there again Saturday 7th March.

There was a great turnout for this new development. Throngs of first time buyers and families filled the showhouses all afternoon. We got a great response all round. Plenty of buzz and excitment.

We are onsite to give information to anyone looking to take the leap and plan a purchase in Landen Park.

Hope to see some of you this weekend!