Interest Rates – As Borrowers Move Towards More Fixing, Brokers Ireland Highlights Where Big Savings Can Be Found

Press Release

Wednesday 11^th June 2025

Responding to today’s Central Bank Retail Interest Rates publication for April showing the weighted average interest rate on new mortgages at 3.72%, 0.38% higher that the euro area average, Brokers Ireland said the climate for mortgage borrowers is improving in contrast to savers with overnight deposit rates remaining stubbornly at a paltry 0.13%, unchanged since November last.  Consumers hold the vast majority of bank savings, over €140 billion, in such accounts.

Rachel McGovern, Brokers Ireland Deputy Chief Executive, noted in today’s figures there was an 11% year-on-year increase, up to 81%, in mortgage borrowers opting for fixed rates.

“This would seem to indicate that those taking out mortgages are looking for security in a world clouded by uncertainty, and of course new mortgage holders are taking on greater debt with continually rising house prices,” she said.

She advised existing and new mortgage holders to consider their positions extremely carefully and take impartial advice, and she said there are savings to be achieved for many borrowers, and these can be substantial, depending on individual circumstances.

“Factors that can yield savings include an improved loan-to-value on your home, that is, the ratio of your loan to the value of your home.

“With property prices increasing many existing rather than new mortgage holders will now have a better LTV, enabling them achieve a better interest rate on the loan,” she said.

“This is something borrowers tend not to do but it is advisable to review it on a yearly basis.”

She said an improved Building Energy Rating may also help a mortgage holder to achieve a green loan with a lower interest rate.

Ms McGovern said while competition is improving it is estimated that up to nine in ten mortgages are held by just three lenders – AIB, Bank of Ireland and PTSB.

In terms of short-term savings accounts she said Ireland is an outlier in holding very high levels of savings in low yielding accounts, and much of that is to do with inequitable tax policies that disincentivise savers from moving to better yielding alternatives.

In this regard Brokers Ireland has recently called on the Government to implement the recommendations of the Department of Finance’s Funds Review Report from October last.

A recent Central Bank report found Irish households’ preference for shorter-term, more accessible deposit account types relative to average euro area has cost them almost €800 million in unearned interest in 2024 alone.

Ends

Note: Brokers Ireland operates the ‘Future Financial Experts’ Transition Year programme aimed at communicating good financial skills to students and creating awareness around financial concepts.

Further information:  Rachel McGovern, Deputy Chief Executive, Brokers Ireland          Tel.086-8259938

Mairéad Foley, Foley Ryan Communications                                                                            Tel. 086-2556764