AIB, EBS and Haven to increase new fixed mortgage rates by 0.5%

AIB has announced it will increase the cost of new fixed-rate mortgages by 0.5 per cent.

The increase will apply across its brands, which includes EBS and Haven.

In a statement, AIB confirmed the new rates will apply for both private home and buy-to-let mortgages from close of business on Friday.

"Existing fixed rate (mortgages currently in a fixed rate period) and variable rate mortgages remain unaffected by the increase," the bank said, adding: "Customers who drawdown their new mortgage before close of business on 14 November 2022 can avail of the previous rates."

The move follows the decision taken by the European Central Bank (ECB) in July to increase interest rates in an attempt to dampen record inflation across the Euro zone.

AIB is the first Irish bank to announce an increase in this regard.

"It is good to see that AIB, EBS and Haven are allowing applicants who have been loan approved up to four weeks to close out on the mortgage they have applied for," chair of the Association of Irish Mortgage Advisors, Trevor Grant said following the announcement.

"This will enable hundreds of mortgage applicants to close on their new homes or secure a much sought-after mortgage switching deal."

Mr Grant added that rate increases are to be expected following the ECB's hike, and said AIB's 0.5 per cent increase "isn't as bad as could have been expected".

"We anticipate further ECB rate hikes before year-end, therefore there is a limited window for many to make the switch to a better deal and avoid the impact of further oncoming rate increases," he said.