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THE EUROPEAN CENTRAL Bank looks set to cut interest rates in June in a move that will ease the repayment burden on tracker mortgage holders.
Reuters reported today that the move is “more or less a done deal”, and it will be pushed through along with a package of measures aimed at boosting lending to Small and Medium Size enterprises.
Personal finance expert John Lowe of moneydoctor.ie said that the rate cut is likely to be in the order of 0.15 per cent, but said that overall the impact would not have a huge impact.
“It’s insignificant in some respects, but it’ll still be a few bob off their mortgage repayments.”
While the rate cut will automatically be passed on to holders of tracker mortgages, Lowe said that those on standard variable rate mortgages are unlikely to have the cut passed on by their banks.
“I’m quite certain that they won’t pass it on.”
The rate cut was first signalled by ECB president Mario Draghi at his monthly press conference last week.
He said: “The Governing council is comfortable with acting next time but we want to see the staff projections that will come out in early June.”
While not overtly explosive, Draghi’s comments, which were versed in the conservative language favoured by central bankers, were welcomed by the markets after several months of inaction.
The move is primarily designed to try and encourage inflation in the euro zone, which is battling sluggish levels of price growth and the spectre of deflation.
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Nice one for Tracker holders, unfortunately this means the banks will be pulling in less money and so Variable rate holders will be punished with interest increases :(
Woohoo!
Luck o’ the draw!
It’s only 0.15 of one percent this time, so you can be less jealous than usual.
Bitches be hatin Alan, bitches be hatin.
No Ronan, bitches be payin’ extra taxes left right and centre on top of the expected increase in our mortgage interest rates.
It’s complete boll!x that Variable account holders will have to pay extra every time Tracker account holders get handed more savings.
So I guess you’re right actually, bitches do be hatin’.
Alan, that was a joke. But you’re right its no laughing matter. Apart from the variable rate, im in the same boat as you.
The local banks will still be pulling their fixed points, above the base rate and making massive gains on the variable rates. They need to begin passing it to variable customers. I think this is the fourth rate cut that us variable folks will likely miss out on.
“burden on tracker mortgage holders” friends who are on trackers are laughing at the moment . What about the rest of us that are screwed with rates of 4.7%!
Feel your pain.Wish there was a maximum permissable spread between tracker and variable rates..we,re paying over ten times the rate..and the banks probably will increase the standard variable rate.
Should have got a tracker
Oh Crystal Ball, why didn’t you show me the property crash when I looked into you 10 years ago just before I bought my house on a crappy variable rate mortgage. Instead all I saw was a plastic Santa and some snow wafting around every time I shook you :(
I’ll bet that man on the double decker bus knows what a tracker mortgage is now!!!
Reduced” from virtually zero to virtually nearly zero.
That’s super Mario
What a awful nice man !!
Have I ever mentioned before just how much I love Mario and my tracker mortgage??
Well for Them just means The banks Are Going to screw us on variable rate.
Got a letter today from my bank today telling me my mortgage payment is increasing. I totally acknowledge that I’m lucky and my mortgage is small compared to others but I know this news is going to make it harder for me and a helluva lot harder for others on variable rates.
We just got the same letter Anne. For no good reason the bank just announced that it was increasing the interest rate. No doubt they will use this as an excuse to increase it again. Ok so maybe we could have got a tracker at some stage too had we played the system better but we have played the game, bought our house, trying to raise our kids and we’re getting kicked over and over for seemingly being in the minority by keeping up our mortgage payments.
That should cover the water tax
I don’t know what a tracker mortgage is?????:(
It cant continue the variable rate mortgage holders support ing the ecb rate holders . Enough is enough on that.
Ecb rate holders as you call them have a contract with their respective banks once they don’t default nothing will change in regards their tracker.
Btw Mario is not worried about variable rate mortgage holders living on an island on the western fringe of Europe.
Í wouldn’t begrudge tracker mortgage holders, I just wish I was one of them. Something should be done for us variable holders though. I know it wont take much to break this particular household if it continues like this.
Super Mario to the rescue !!! Thank god for the ecb
I may increase my over payment
Let’s hope it does something for people like me, working away, the Euro is to strong at the moment, when I send money home too my family every month it’s E200 short compared to a year ago because of the exchange rate :(
I feel Your pain Michael, I’m in Canada and it’s fairly weak compared to the euro
It is great for anyone heading to the uk for a break tho
Not really, the euro has weakened considerably against the pound the since August 2013
When we got our mortgage first it was over 8% we had a 10 yr fixed loan when that finished we just left it variable and as its a tracker its 1.8% or something like that! Costs 341.00 a month!
Ah sure. That’s great. And what would your date of birth and mother’s maiden name be, now?
We’re all going to heaven lads Wahey
Ánd I received word from PTSB that my variable rate is going up. Oh the joys of both paying the banks debt for them and being screwed by them at the same time.
A tracker mortgage does not affect a variable mortgage. If Mario lowers the rate and your bank fails to pass it on then have it out with your bank. Your bank is now or will be borrowing at a cheaper rate. If there was no such thing as a tracker mortgage they still wouldn’t pass it on. A tracker mortgage is still making a profit unless the rate goes to minus 1% or1.5℅ which it wont .
So don’t loss sight of the fact that the banks screw people on variable rates because they can.
Ever get the feeling that there is a sh!t storm coming down the tracks from the banks, on top of everything else.
*I don’t even know what a tracker mortgage is* reference
The Mario EU little world revolves around tracker mortgages .. Once again variable mortgages holders get punished. Please Putin invade and save us from this dictatorship .
Good man Mario.
have your say