Variable Rate

The Variable Rate may be increased or reduced by EBS from time to time at its discretion.

Advantages:

• Ability to make lump sum payments or clear the mortgage at anytime without any additional charges.
• The Variable Rate may cost less than a fixed rate over the fixed rate term.

Disadvantages:

• This rate is not directly linked to any reference rate e.g. European Central Bank (ECB) – Base Rate. This means that this rate may be increased out of line of any reference rate movements.
• The Variable Rate may cost more than a fixed rate over the fixed rate term.

Fixed Rate

Where a Borrower applies for a fixed interest rate, it will be for a set period of time. When the fixed rate period ends the loan will convert to the applicable variable rate.

Advantages:

• The fixed rate may be lower than the applicable variable / tracker rate over the fixed rate period and therefore a borrower may pay less than if they remained on the variable / tracker rate.
• Once applied, the fixed rate will not be affected by increases in variable / tracker rate movements, which means there is certainty of repayment amounts during the fixed-rate period. This enables customers to budget their outgoings with certainty.

Disadvantages:

• The fixed rate may exceed the variable / tracker rate over the fixed rate period and so the borrower may pay more than if he or she had remained on a variable / tracker rate for the same period.
• An early redemption charge is payable in the following cases where the fixed rate period has not expired:

1. If a capital payment or full repayment is made to the loan, including an involuntary/voluntary payment from a third party source e.g. a payment from a Mortgage Protection policy; or
2. If the loan is converted to a variable rate; or
3. If the loan is converted to another fixed rate.
   

• If a borrower moves from a tracker rate to a fixed rate, they cannot avail of the tracker rate option on expiry of the fixed-rate term.
• The variable rate which may be available at the end of the fixed rate term may be higher than that which was available prior to fixing.

Tracker Rate

A tracker rate is a guarantee that the rate being charged will not exceed the ruling reference rate (e.g. ECB rate) by a specified margin e.g. 1.25%. It will therefore track the reference rate as it moves up and down. Please note tracker rates are no longer available.

Advantages:

• The tracker rate may not be affected by increases in the Variable Rate
• The tracker rate may cost less than the Variable Rate
• Ability to make lump sum payments or clear the mortgage at anytime without any additional charge
• The Tracker Rate may cost less than a fixed rate over the fixed rate term

Disadvantages:

• The tracker rate may not be affected by decreases in the Variable Rate
• The tracker rate will be automatically increased in line with the reference rate upward movements
• The tracker rate may cost more than a fixed rate over the fixed rate term
  

Important / Regulatory Notice

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