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Fixed Rate or Variable Rate Mortgage? Which is Right for You?

Introduction:

Trying to decide between a fixed or variable rate mortgage in Ireland? Read on to learn about the pros and cons of each and make an informed decision.

When it comes to choosing a mortgage, many Irish home buyers are faced with the decision of whether to opt for a fixed or variable rate. While fixed rates are popular in today’s rising interest rate environment, there are advantages and disadvantages to both options.

Fixed Rate Mortgage:

A fixed rate mortgage has a specified interest rate that remains the same for the duration of the loan. This means that the borrower’s monthly interest and principal payments will remain the same each month. The benefits of a fixed rate mortgage include:

  • Peace of mind knowing that your monthly repayments will remain the same, making it easier to budget.
  • Peace of mind knowing that your monthly repayments will remain the same, making it easier to budget.
  • Protection from potential future interest rate increases during the fixed period.
  • Flexibility to shop around for a new mortgage deal six months before the end of your fixed term.
  • No risk of market fluctuations resulting in missed opportunities to benefit from lower repayments.

However, there are also downsides to fixed rate mortgages, including:

  • Penalty fees for moving house or making lump sum payments.
  • Potentially higher interest rates compared to variable rates for longer fixed terms.
  • Missing out on any potential benefits if interest rates drop during the fixed period.

Variable Rate Mortgage:

A variable rate mortgage, on the other hand, has an interest rate that can change over time, based on market interest rates. The benefits of a variable rate mortgage include:

  • Lower interest rates at the time of application, which may reflect current market conditions.
  • Flexibility to increase monthly payments, pay off the mortgage early, or switch to another lender without penalty charges.
  • Potential to benefit from falling ECB interest rates.

However, variable rate mortgages also come with disadvantages, such as:

  • Lack of stability or predictability, as the interest rate can increase as well as decrease based on current market values.
  • Potentially higher interest rates in the future due to future market conditions.


The choice between a fixed or variable rate mortgage is ultimately a personal one based on your financial goals and attitude to risk. If you are risk-averse and want stability, a fixed rate mortgage may be a good option. If you want flexibility and are comfortable with financial risk, a variable rate mortgage may be the way to go.

At Ezfees Financial, we can help you assess your options and find the best mortgage rate for your needs. After all, we are here to help you! Contact us at info@ezfeesfinancial.ie today. We’d love to hear from you! https://ezfeesfinancial.ie/#Enquiries

Ezfees Financial Ltd T/A ezfees financial is regulated by the Central Bank of Ireland. Reg no 489026

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