Local homeowner could pay over €70,000 extra due to mortgage rate hikes

A mortgage holder in Leitirim has seen their mortgage repayments jump by €400 per month, meaning they will pay an extra €72,000 over the lifetime of their mortgage according to a local counicllor.

Councillor Padraig Fallon said mortgage interest rate hikes must be tackled now.

“Mortgage repayments are rising by colossal amounts – by thousands of euros a year for many, with some now paying interest rates as high as 8%,” he said.

The Free Legal Advice Centre have said that many are now at risk of falling into arrears, he said, while MABS have warned that recent interest rate hikes are having disastrous effects.

“Rising mortgage rates are also putting the possibility of buying a home beyond the reach of aspiring first-time buyers, many of whom continue to suffer with crippling rents and rising house prices due to the government’s failure to deliver affordable housing,” Cllr Fallon said.

He said that Sinn Féin has repeatedly called for the introduction of temporary mortgage interest relief, which would support struggling mortgage holders by up to €1,500.

“The government has failed to listen with the situation approaching a crisis point for many,” Cllr Fallon said.

“The government can and must reverse its position and mandate the Minister for Finance, Michael McGrath, to commit to his previous position on this issue in 2018 when he supported mortgage interest relief.

“Such a measure is sensible and necessary. It’s a must,” Cllr Fallon said.

Speaking this week, Taoiseach Leo Vardakar said of the upcoming budget:” As you know, our limitation isn’t the public finances – we have the money – it’s the risk of fuelling inflation. We need to be conscious of that risk, but we have a responsibility to take decisive action on behalf of our citizens.

I believe an overly cautious approach could see more people in poverty and financial distress,” he said.

“If Government takes an overly cautious approach, in a cost-of-living crisis, it’s making a conscious decision to reduce living standards. That’s not something I can stand over given our fiscal position.

“Having said that, we have not, and we never will, use temporary revenues to fund permanent, recurring day-to-day spending.
“We have managed the public finances well for the last decade, while reducing income taxes, increasing public spending and growing jobs,” the Taoiseach said.

Hard-pressed mortgage holders have seen variable and tracker mortgages increase significantly in the past year, as the ECB hikes interest rates in an effort to tackle rising inflation.

There have been seven ECB rate increases since last summer up to the end of May of this year, with another two now expected by September, increasing the montly repayments for variable mortgage accounts.