Avant Money enters the mortgage market with a fixed rate of 1.95%

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New mortgage lender Avant Money begins accepting applications for its products starting today, with fixed rates as low as 1.95%.

This makes it the lowest rate currently available in the Irish mortgage market.

Its variable rate offer starts from 2.5%.

In order to qualify for the 1.95% rate, the prospective lender must have a down payment of at least 40% of the value of the property.

The rate is available for up to seven years fixed.

For a typical first-time buyer with a 20% down payment, Avant offers a 3-year fixed rate of 2.2% with a trailing variable rate of 2.75%.

Compared to the best alternative available on the market today, she says the borrower could save on a 30-year loan of €250,000 of €8,704.

The products will be available through the broker network for those moving, changing mortgages or buying their first home once they meet the Central Bank’s lending criteria on income and deposits.

Avant Money, formerly known as Avantcard, is based in Carrick-on-Shannon, Co. Leitrim with a second office in Dublin.

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It has been operating in the personal loan and credit card market here for two decades.

Avant Money belongs to the Spanish banking group Bankinter, which is also present in Portugal and Luxembourg.

“We are confident that our products and pricing will be attractive to Irish customers who have been underserved for too long with their mortgages,” said Chris Paul, CEO of Avant Money.

“Unlike other providers, we’ve eschewed short-term gimmicks like cashback offers in favor of products and rates aimed at providing real, quantifiable savings over the life of a typical mortgage.”

Chris Paul, CEO of Avant Money

Central Bank figures last week showed Ireland had the third highest mortgage interest rate in the euro zone in July with an average rate of 2.82%, up 3 basis points from compared to June.

Brokers Ireland, a representative body for mortgage brokers across Ireland, said mortgage holders were being ‘cheated’ by providers here and welcomed news of increased competition with a new incoming provider on the market.

Speaking on Morning Ireland, Chris Paul dismissed suggestions that Avant was seeking to ‘select’ the market by targeting particular occupational classes.

He said all applicants would be considered on an individual basis, as long as they meet the Central Bank’s income and deposit criteria, including those currently supported by government wage subsidy programs.

He also confirmed that potential borrowers would not be required to purchase mortgage protection and home insurance from Avant in order to qualify for the rates offered.

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In a research note, Davy analysts Stephen Lyons and Diarmaid Sheridan said rates looked attractive, but the lender’s ability to increase share would initially be limited by its broker distribution.

“The offerings appear to undercut traditional banks by at least 25-30 basis points (basis points) on an aggregate basis, but do not include significant additional features elsewhere in the market – such as cashback, change fee, current account discount and/or insurance discount,” they said.

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