Permanent TSB is to overhaul its pricing model for mortgages from Wednesday of this week.
From Wednesday, the bank will charge new customers different variable rates depending on the size of the mortgage relative to the value of the property
It said that for purchasers borrowing less than 50% of the value of the property, the new variable rate will fall to 3.95%, down 0.39% from the current rate of 4.34%.
For those borrowing at higher loan to value ratios, the variable rate will increase through various stages.
The rate are as follows:
less than 50% - 3.95%
less than 60% - 4.05%
less than 70% - 4.15%
less than 80% - 4.20%
less than 90% - 4.45%
The bank has confirmed that the new rates will be available to people moving their mortgage from their current bank but not selling their home, as well as first time buyers and those selling their home and buying a new one.
''This is a much more sophisticated pricing model for mortgages which will allow us to reward customers who have a lower risk profile while charging a higher rate from customers who represent a higher risk by virtue of the amount of money they are borrowing relative to the value of the property,'' commented the director of lending at Permanent TSB Ger Mitchell.