Friday, January 2, 2009

Despite the recent series of interest rate cuts announced by the European Central Bank, mortgage holders living in Affordable Homes bought from Fingal County Council and the government’s Affordable Housing Partnership still have not benefited from the reductions.

Fingal County Council’s current variable rate is 5.25% and the fixed rate is 5.5%.

The Council is charging a significantly higher interest rate than the commercial banks and they are imposing the charge on the people in our community who are finding it hardest to make ends meet.
The ridiculous bureaucratic system operated by the government is to blame for this. Fingal County Council only reduces rates after the government’s housing quango, the Housing Finance Agency controlled by John Gormley, tells the council that the European Central Bank has cut rates. This results in a significant delay.

The ECB cut interest rates for the first time in October. But the government agency did not get around to formally informing Fingal County Council until December 2008. The council will take another month before passing it on to mortgage holders in the form of a 0.5% cut on January first. The second decrease of 0.5% will not come into effect until Feb 1st, bringing the rate to 4.25%. Fingal’s loans department is still waiting for authorisation on the third decrease of 0.75%.

At a time when thousands of people are losing their jobs and many home owners are under serious pressure to repay mortgages, the largest county council in the country is not passing on the benefits of interest rate cuts to local authority mortgages holders under the affordable housing scheme.

Current Commercial Bank Rates
Allied Irish Bank:

As of December 17th 2008 3.75%

Bank of Ireland (College Green, Dublin 2)
First time buyer variable rate:
December 2008 4.1%

Permanent TSB
First time buyer variable rate
January 2nd 2009 4.19%

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