John Deasy (Waterford, Fine Gael)
Link to this: Individually | In context

Question 184: To ask the Minister for Finance if he has plans through his negotiations with the banks to assist people who wish to transfer from fixed rate mortgages to variable rate mortgages without incurring the present costs that these institutions are demanding. [17849/09]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
Link to this: Individually | In context

The Deputy's question refers to the redemption fee applied by mortgage providers in circumstances that a customer seeks to break a fixed rate mortgage. Mortgage lenders in Ireland generally seek to recover costs of funds when a borrower with a fixed rate mortgage agreement seeks to terminate the agreement some time before the term agreed.

On 26 March 2009, I undertook, in this House, to contact the Consumer Director of the Financial Regulator on the subject of customers who wish to switch from a fixed rate mortgage. On foot of that my Department has contacted the Financial Regulator to request confirmation that the redemption costs for switching from a fixed rate mortgage cover funding costs only and that there are no other costs included in these charges. The Financial Regulator has confirmed to my Department that it is looking into this matter and that it will revert shortly. I will advise the Deputy of the outcome of the Financial Regulator's consideration of this matter.