Standard variable mortgage rates in Ireland are said to be up to two percentage points above the Eurozone average.
The Irish Independent today reports that standard variable mortgage holders are paying up to eleven weeks pay a year more than tracker holders to meet the extra costs banks are landing on them.
The Irish Brokers Association estimated a family with a €200,000 mortgage would have to earn €12,500, or €6,000 after tax, to cover the premium on their standard variable mortgage each year.
Finance Minister Michael Noonan asked Central Bank Governor Patrick Honohan for a report on why standard variables are charged at rates of over 4% while trackers are just over 1%. The European mortgage average is 2.47%.
Liam Twomey, Fine Gael TD and Chair of the Finance Committee, spoke to Newstalk Lunchtime about the figures.
Deputy Twomey says, "competition is an issue. We don't have the same level of competition in the Irish mortgage market like we used to have it... it's something we need to make sure we can try and improve now that our economy is growing again".
"We must find out from the banks why they are 1 to 2 percentage points above the Eurozone average, and that is still a significant amount for people who are on standard variable rates," he added.
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