Richard Bruton (Dublin North Central, Fine Gael)
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Question 167: To ask the Minister for Finance if he has examined the difficulties created for people who are on high mortgages at fixed rates and who are receiving no relief from falling rates; if he has raised their plight in his discussions with the banks; and if initiatives for easing their problems have been put forward. [45953/08]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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The choice of mortgage product ultimately rests with the consumer in light of the terms and conditions that their lending institution offers. The decision of borrowers is influenced by factors such as their personal preferences and their own assessment of the relative merits of fixed and variable rate mortgages taking into account the information made available by the Financial Regulator. The Financial Regulator, which has a statutory consumer protection mandate, provides advice to consumers on the advantages and disadvantages of fixed rate mortgages. As the Deputy will be aware, the cost of a fixed rate mortgage reflects longer-term funding costs for the financial institution which provides it. Therefore, in contrast to tracker and variable rates, the cost neither rises with an increase in the ECB base rate nor falls with a reduction in it. The Financial Regulator has highlighted, in the context of its consumer information role, that for those whose finances may be stretched, such as first-time buyers, fixed rates offer peace of mind. While they may cost more over the longer term they allow the mortgage holder to budget confidently. However, the Financial Regulator also stresses that fixed rate mortgages give less flexibility than variable rates. My Department will monitor the issue raised by the Deputy, in consultation with the Financial Regulator, in relation to credit institutions participating in the Guarantee Scheme, in light of the objectives of the Scheme.