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Ask the mortgage expert: ‘Assuming home loan rates will fall is a mistake’ 

Anyone who assumes home loan rates will fall substantially soon is making a mistake, according to one mortgage expert. 

On this week’s Ask the Expert, Irish Mortgage Advisors Association Chairperson Trevor Grant answered all loan-related questions. 

His first piece of advice is not to decide about your mortgage based off the impression of current bank rates. 

“Rates are in a good place,” he told Lunchtime Live.

“They were very, very low for 11 years when ECB was at zero and then they jumped quite significantly. 

“ECB increased by 4.5% – thankfully the home loan providers here didn’t increase by as much they increased by a little over 2%.” 

If you’re deciding between a fixed or flexible mortgage rate, Mr Grant advised looking over all your options. 

“When you look at the long-term yields, in terms of the European banks… they’re fairly flat looking forward,” he said. 

“Anyone assuming home loan rates will fall will be making a mistake – They may fall but maybe not as much as many people think. 

“I wouldn’t be taking a mortgage out at a variable rate simply because I was expecting them to fall significantly because I don’t think that will fall significantly. 

“Look at your options, see what you’re comfortable with – don’t back the horse because you think it’s a sure thing.” 

Mortgages as a married couple

One listener asked if a married person can apply for a mortgage as a single applicant without their spouse. 

Mr Grant said whatever names are on the title of the property must be on the mortgage. 

“If money has been borrowed on a property, the person whose name is on the title to the property must be on the mortgage,” he said. 

“It is possible in buying a new property with a married couple for the applicant and the person whose name is on the title to be in single names, but that’s got legal complexity to it. 

“In theory, if I’m married, I can buy a house in my own name, but essentially, my husband or wife needs to sign away the rights to the property.” 

Mortgages on maternity leave

Another person asked how pay-reduced maternity leave will affect their mortgage payments. 

Mr Grant said there are two options for a lender in this case. 

“If you’re on maternity leave and your pay is reduced, the lender can work off the reduced pay or they can work off your full pay, provided they have a letter from your employer confirming the date you’re going to return to work,” he said. 

“Lenders have become very reasonable in this regard.” 

He said as long as they have a letter from the employer confirming the return date, the terms of the mortgage will either be unchanged or be revised. 

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