Mortgage provider Avant Money will raise some of its interest rates for new customers due to rising financing costs.
The lender’s five-year fixed rates are to rise by 20 basis points (bps), while its seven- and 10-year fixed rates are to rise by 30 basis points.
It is also to increase the rates of its “One Mortgage” product over 15 and 20 years which guarantees the same rate for the entire duration of the loan.
The move comes ahead of an expected interest rate hike by the European Central Bank, possibly as early as next month.
The development is likely to further focus the minds of potential and existing borrowers on whether to lock in their mortgage rate now.
Along with the increases, Avant Money is to cut rates on its longer-term 25- and 30-year “One Mortgage” offerings.
While its fixed rates at 3 and 4 years must remain unchanged.
“We see considerable upward pressure on financing costs and recognize that the option to repair longer may be attractive to many of your customers,” the company said in a statement.
“The One Mortgage price reductions are intended to make this option an even more compelling choice for customers.”
The company said existing customers won’t see any rate changes, while those in the application pipeline will have until July 15 to complete the levy at the old rates.
New customers who apply after May 13 will only be offered the new rates.
“If people put off the repair or change until now, they have no excuse,” said Trevor Grant, president of the Association of Irish Mortgage Advisors.
“It will probably be the first of a series of increases.”
He added that rates have been at historic lows for some time and mortgage holders should consider their options to lock in and protect against future rate increases that are inevitable.
“Even those with existing fixed agreements should ask their lender if there are any breakage fees to be settled with the same lender or elsewhere,” he added.
Avant isn’t the first mortgage provider to raise rates.
In March, ICS raised its fixed rates for new customers with increases of between 20 and 45 basis points.