Nationwide's new blow for homeowners
MORTGAGE holders are reeling from another blow today as a third lender cut off the option of a fixed-rate loan.
Irish Nationwide Building Society says it is temporarily suspending the option for existing customers, which means that anyone coming to the end of a fixed-rate loan or those on the standard variable rate will no longer be able to fix their interest rate.
"This decision has been taken due to prevailing market conditions and the associated high cost of fixed funding and will be reviewed on an on-going basis" said a statement from the company.
Asked if there were any plans to increase the standard variable rate from the current 3.75pc, a spokeswoman said there were no such plans at the moment but it was constantly under review.
Earlier this month Irish Nationwide was told by the High Court to stop issuing new mortages.
All fixed-rate offers already issued to new customers would be honoured once they are returned signed and completed within the contracted terms, the lender said. The documents must be received and stamped at Irish Nationwide head office by Friday.
It said existing fixed-rate mortgage customers coming to the end of their fixed term will revert to the standard variable rate.
EBS last week suspended its fixed-rate options, while the majority of existing customers with Permanent TSB no longer have the option of fixing.
Irish Mortgage Corporation director Frank Conway said lenders were now mistreating people on variable rates.
"The lenders are cornering existing standard variable rate customers and turning them into cash cows," he said.
"They will continue to milk them to get all they can out of them."
Already this year, a number of lenders have increased their fixed rates including EBS, Ulster Bank and KBC Bank.
Permanent TSB, Ulster Bank and EBS have also increased their variable rates.
In relation to the State-owned Irish Nationwide Building Society, brokers said that the company offered some of the best fixed rates available in the market.