AIB has become the latest financial institution to increase its fixed interest mortgage rates. The bank says that rates for new residential owner occupier and buy-to-let mortgages will rise from close of business today
The bank says the increases are due to the increased cost of fixed rate mortgage financing.
The bank's one-year fixed rate for owner occupiers rises to 4.15% from 3.59%, while its five-year rate will increase from 4.30% to 5.35% from 4.39%.
Buy to let customers who want to buy a one-year deal will now have to pay 5.15%, instead of 4.59% while those seeking a five year rate will have to pay as much as 6.35%, up from 5.39%.
The bank's two-year, three-year and four-year rates are also rising.
AIB is the fifth of the main banks to up their interest rates since January. Irish Life & Permanent, Ulster Bank, EBS and KBC Bank have all done so already, fuelling fears of a mortgage debt crisis.
Recent Central Bank figures showed that one in 10 mortgages were now in difficulty - either in arrears or renegotiated by homeowners because of struggling finances - were on the up.
But these did not include figures for January when the first mortgage increases of the year were announced.
With tax increases, increased inflation and pay cuts coupled with other austerity measures implemented in December's budget, there is widespread concern that more and more residential and buy-to-let mortgagees will default.
In February Permanent TSB announced it was increasing its fixed mortgage rate by as much as three percentage points while Ulster Bank, EBS and KBC quickly followed suit with increases in their variable rates.
