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Should I Fix My Mortgage 2022 Ireland? Ultimate Mortgage Fixing Guide

With runaway inflation across the continent the European Central Bank looks set to hike interest rates with the cost of Irish mortgages set to rise as a result. 

So the question your probably asking is should i fix my mortgage?

should i fix my mortgage

ECB rates rose in July to 0.5%, the first hike in over eleven years, but rates are expected to rise a further 0.5-0.75% on the 8th of September when the ECB rate gurus next meet.

The financial markets are expecting rates to have risen by at least 2% in the next 12 months, which would add over €200 a month to the average Irish mortgage.

The good news is that by fixing your mortgage rate now you can dodge the coming rate hike and probably cut your current repayments at the same time.

The Irish mortgage market is almost unique in having fixed mortgage rates priced well below variable rates and over 140,000 mortgage holders could save big by switching now and fixing on a lower rate, read on to see how much you could save and how.

How much you could save by fixing? – Should I Fix My Mortgage 2022 Ireland

According to the latest Irish Central Bank figures available, the average variable rate in Ireland is around 3.8%, this is probably what you are on if you are with Bank of Ireland, AIB, Ulster, KBC and PTSB and not on a tracker.

If you are with any of these banks then you should look into switching to a fixed rate.  If you’re not sure about what rate you’re on dig out your annual mortgage statement, or take a gander at the table below.


Follow on/Variable Mortgage Rates
up to
50% LTV
Follow on Rate
up to
60% LTV
Follow on Rate
up to
70% LTV
Follow on Rate
up to
80% LTV
Follow on Rate
up to
90% LTV
Follow on Rate
Avant Mortgage2.45%2.45%2.45%2.70%2.70%
ICS Mortgages3.70%3.70%3.70%3.95%3.95%
Finance Ireland4.75%4.95%4.95%4.95%5.15%
Haven Mortgages2.75%2.95%2.95%2.95%3.15%
AIB Mortgage2.75%2.95%2.95%2.95%3.15%
KBC3.00%3.00%3.05%3.05%3.3%
Ulster Bank3.50%3.50%3.70%3.70%3.90%
EBS Mortgage3.30%3.50%3.5%3.50%3.70%
Permanent TSB3.70%3.70%3.70%3.70%3.90%
Bank of Ireland3.90%3.90%4.20%4.20%4.50%
Probable follow on variable rates post fixed period based on current variable rates by provider

The best long term fixed rate in the market is currently Finance Ireland’s 15 year fixed rate at 2.96%. 

So let’s run the numbers on an average outstanding loan of €200,000 and average outstanding term of 15 years. This is the case for Joe Average based on data from the Irish banking and payments federation.

  • Total monthly at variable rate of 3.8% = €1,459
  • Total monthly at a fixed rate of 2.96% = €1,372

That’s a saving of €87 a month or €15,660 over the full term and that’s not even an extreme case, that’s just Mr Joe Average.

However, that’s not even the biggest reason for you to switch.

The no 1 reason to switch is that you will cap your repayments, protecting yourself from further rises.

The Pro’s and Con’s of Fixed v Variable – Should I Fix My Mortgage 2022 Ireland

The bizarre thing is that fixed rates are usually a better choice for mortgage holders, even before you compare fixed versus variable rates savings, because they are less risk.

For most people the certainty of knowing the payment at the end of the month won’t rise for 5, 10 or even 20 years far outweighs the risk that they might end up paying more than the going rate at some point.

In fact that’s why fixed rates in other countries are usually more expensive than variable, they are effectively ‘insurance’ that your repayments can’t rise.

Let’s take Mr Joe Average again who is on a variable rate of 3.8% paying €1,459 a month.

Remember that expected ECB rate increase of 2%? The banks will pass that straight through to Joe increasing his variable rate to 5.8%.

  • Total monthly at variable rate of 3.8% = €1,459
  • Total monthly at variable rate of 5.8% = €1,666
    Total monthly at a fixed rate of 2.96% = €1,372

If the ECB hike rates by 2% as expected, Joe’s monthly repayments on his variable rate will go up by €207 a month. Making his monthly repayments €294 more a month than if he had fixed for 15 years with Finance Ireland.

There are still a couple of things to watch out for though with fixed rates. As well as the chance you could end up paying more if rates fall, you can also be penalised if you want to payback early.

Even then you might not have to pay a ‘breakout’ fee in your fixed period. Under EU legislation the banks can only charge you the difference between the rate when you originally fixed and the rate when you look to repay. 

Who Should I Fix With? – Should I Fix My Mortgage 2022 Ireland

For most people we advise switching to the non bank lenders Avant Money or Finance Ireland. As new entrants these lenders offer attractive long term rates, but also the best variable rates once you come off your fixed rate period.

This gives these mortgages a much lower average rate across the whole mortgage term, known as the APRC [1].

We would also encourage you to fix for as long as you’re comfortable with. Although this may cost you more in the short term, the benefit of capping your repayments will out weight the extra cost for most people.

The best fixed deals in the market across all 7 lenders and 290 mortgage products are shown below.

RankMortgage ProductAPRCApprovalSpeedRate RiskRating
1Avant Money Mortgage 15 Yr Fixed3.48%MediumGoodLow4.75
2Avant Money Mortgage 7 Yr Fixed2.81%MediumGoodMedium4.50
3Avant Money Mortgage 3 Yr Fixed2.44%MediumGoodHigh4.00
APRC is the Average Rate paid across the whole mortgage term @ LTV of <50%

How to fix your mortgage rate – Should I Fix My Mortgage 2022 Ireland

The simplest way to fix is to get in touch with your existing lender and get them to move you to their fixed rate. 

This option, although hassle free, is unlikely to deliver big savings as many of the fixed rates are reserved for new customers only and the best fixed rates in the market are with the non bank lenders Avant Money and Finance Ireland.

So the best way to fix your mortgage and save big is to switch your mortgage to one of these ‘non bank’ lenders. With regulation and new online platforms emerging in the last few years switching is now quite straightforward, most brokers will handle it for free as they are paid a commission by the lenders.

In a Nutshell – Should I Fix My Mortgage 2022 Ireland

So should I fix my mortgage?

Probably.

With such uncertainty about interest rates right now almost everyone should look into fixing. Being able to cap your repayments against future potential interest rate rises, makes sense for almost anyone with a mortgage.

Even those with trackers or on shorter term fixed rates need to think about if they can afford not to.

If your on a variable though it really is a no brainer, you will save thousands and remove the worry around rising repayments.

Next Steps – Should I Fix My Mortgage 2022 Ireland

You can read more about the switching process here or check out the best fixed rates here.

If you’re on a tracker you can read our guide to switching from a tracker here or if you are in a fixed rate our guide to breaking your fixed rate here.

If you need individual advice on the best options for you, you can book a mortgage call with a qualified advisor here.

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