Lenders in the Irish mortgage market need to take a more creative approach when developing mortgage products for customers according to the Association of Expert Mortgage Advisers (AEMA).
The Association claims that it will be a case of first mover advantage to the lender that shows some ingenuity and a desire to satiate the needs of borrowers, rather than being solely focused on the bottom line.
The Association of Expert Mortgage Advisers are calling on lenders to look at introducing a type of “lifestyle” mortgage product which can be tailored to the changing needs of mortgage holders as they go through life.
Director at the Association of Expert Mortgage Advisers, Ken Murray commented, "There is currently a dearth of creative and flexible mortgage products on the market. Lenders are all competing solely on price. But anecdotal evidence from brokers suggests that there are other selling points which often outweigh minimal pricing differences – such as flexibility and/ or security.
"The pensions industry have promoted a more tailored approach to their products for years – so why not the mortgage industry? Arguably people need flexibility in their mortgage more than they need it in their pension."
"For example, we see a lot of First Time Buyer couples on the average industrial wage who are likely to be affected by any rate changes – many of these people would gladly opt for the security of knowing their mortgage repayments were fixed over a longer term than those currently offered.
"This would protect them from rate fluctuations for a period when they are unlikely to experience a huge growth in in disposable income and therefore are unlikely to want to trade-up or overpay their mortgage, but also during a time when they may see other expenditures rise, such as costs of raising children etc.
"The security of reducing the term in which your mortgage repayments can change would be appealing and financially sound to many people. People could even fix a certain % of their mortgage & keep the rest variable so they are covered on both fronts."