Irish Permanent has announced 35-year mortgages. It says the move is in response to recommendations made in the Bacon report on the housing crisis.

The company pointed out that, while the longer term would reduce monthly payments, extending the loan to 35 years would increase the overall interest owed on the loan. However, it said that as financial circumstances improve, customers could avail of a repayment option which would allow them increase the monthly payments, thereby reducing the amount owed and lowering the amount of interest payable.

The monthly payment on a £50,000 mortgage over 20 years at 5.75 per cent fixed rate for two years is £351.04. Repayments on the same mortgage over 35 years are £276.75.

First National has announced a new product for first-time buyers, with a five-year fixed rate mortgage at 7 per cent APR, including a 1 per cent discount on the rate for the first year.

This would give a rate of 5.4 per cent in year one, and 6.4 per cent in years two to five.