454 / 822
GAZETTE
SEPTEMBER 1988
Institution
Declared
Monthly
Rate %
Repayment
Per £1,000
borrowed*
Banks
Allied Irish Banks
9 . 3 7 5
£ 9 . 1 2
Bank of Ireland
9 . 5
£ 9 . 27
National Irish
9 . 5
£ 9 . 2 0
Ulster Bank
9 . 0
£ 9 . 1 29
Building Societies
Educational
8 . 2 5
£ 8 . 6 5
First National
8 . 2 5
£ 8 . 6 5
ICS
8 . 4 5
£ 8 . 77
Irish Na t i onw i de
8 . 2 5
£ 8 . 6 5
Irish Permanent
8 . 2 5
£ 8 . 6 5
*On a twenty
year
mortgage
Loans are issued in advance of this
on t he unde r t ak i ng of the solicitor
t he r eby dispensing w i t h t he need
for bridging finance. The banks will
n o r m a l l y use t h e b o r r o w e r s'
solicitor - bonding being required.
Allied Irish Banks: Currently the
cheapest of t he banks in t e rms of
r epa ymen ts per £ 1 , 0 00 - see
table. En d owme nt mo r t gages are
given t h r ough Allied Irish Finance
- the interest rate is quo t ed at half
per cen t age point higher.
Bank of Ireland: It does not
charge an application fee. It o f f e rs
t he op t i on of having 10, 11 or 12
r epa ymen ts a year so t hat t he
bo r r ower can have a mo n th or t w o
f r ee of r e p a yme n t s. It o f f e rs
e n d o wme nt mo r t gages but t he
policy mu st be t aken out w i t h t he
Bank 's o w n subsidiary " L i f e t i me
I n s u r a n c e ". They are Managed
Fund unit-linked policies yvith t he
p r em i um level r e v i ewed every five
years t o take account of the f unds'
pe r f o rman c e.
National Irish: It is offering a
facility wh e r e by there are are no
r e p a y m e n t s f o r t h e f i r s t s ix
mo n t h s, but, of course, interest is
c l oc k i ng up during t hat t ime. It is
r e a l ly j u s t a n o t h er w a y
of
increasing t he loan - a useful
facility for some but not costless.
In mu ch t he same w a y Bank of
Ireland o f f e rs loans of 9 0 % of its
va l ua t i on plus £ 1 , 0 0 0. National
Irish o f f e rs second mo r t gages at a
declared cost of 11 Vi % w i t h it
bearing all legal cos ts etc.
Ulster Bank: Has been active in
t he home loan business for a long
t i me and o f f e rs a l ower interest
rate t han either Bank of Ireland or
National Irish - only marginally
higher t h an AIB.
THE MA IN
BUILDING SOCIETIES
All t he ma in building societies are
n ow o f f e r i ng e n d o wme nt mo r t-
gages in addition t o t he traditional
type. They will also provide finance
f o r t h i n g s o t h er t h a n h o u se
purchase but, by law, t hey do
require t he security of a mo r t gage
on property. A change is proposed
in t hat law but t he legislation has
y e t
t o
be
p u b l i s h e d.
T he
a c c omp a n y i ng table gives simply
t he rates charged on loans for
house purchase - higher rates
may apply to other loans.
Wh i le t i e r ed rates are n ow
banned by law whe re t hey are
based on size of t he loan, some
societies may charge a higher rate
wh e re t he bo r r ower does not
c omp ly w i t h certain requirements
- such as being a member w i t h
certain m i n i mum savings. This is
t he case w i t h Irish Nationwide, for
instance, but given t he compe t i t i on
wh i ch currently exists it may well
be open to negotiation.
W i t h one e x c ep t i on, all t he
societies in t he table charge t he
same rate of interest on basic
loans. The odd man out is t he ICS
Building Society - an associate of
t he Bank of Ireland. Its interest rate
and repayment rate are higher t han
the others although in all cases t he
societies are cheaper t han t he
banks. The rates s h own are t hose
w h i c h c ame into e f f e ct for n ew
borrowers f r om Ju ly 1 and are due
to take effect for existing borrowers
f r om Augu st 1.
Colm Rapple is group
business
editor. Irish Press and author of the
best
selling
annual
"Family
Finance".
It is intended to cerry more
erticles on personal finance
topics in the future. If there
is a particular area you
would like to see covered
let us know.
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