Main PointsEuropean Central Bank (ECB) leaders meet in Frankfurt today to discuss raising interest rates, with a 0.25 hike widely expected. Investors are currently pricing in two quarter-point rate rises this year, which would lift borrowing costs in the euro zone to 2.5 per cent, the highest level since March 2025. Key ReadsWhat are the best mortgage options in Ireland right now?Podcast: Is your fixed-term mortgage ending this year? Tips on getting lowest rates in IrelandConor Pope - 10 minutes agoWhat should borrowers do now? The IT Business podcast has the answersOn the latest Irish Times business podcast, Michael Dowling of Irish Mortgage Brokers goes through what the rise in interest rates means for various types of borrowers. There are a few key messages. New buyers are clearly better to look at locking in - and might even consider longer terms than the typical three years. Those on old style variable rates would, in most case, save money by taking one of the fixed rate offers in the markets, as well as protecting themselves from possible rises as ECB rates go up. People on trackers will take a hit, though many will still be on rates around 3.25 per cent after the ECB increase, which is still OK by historical standards. Have listen here. Conor Pope - 23 minutes agoMortgage holders do hold some cards even when rates climbIt is worth noting that even in an era of rising rates, people have options. As Martina Hennessy points out, the biggest risk for some borrowers isn’t a rate rise itself but assuming they have no options. “The market currently remains competitive, with rates starting from 3 per cent and products rewarding those with lower loan to values. This means that homeowners who have seen the value of their home increase could be in a position to unlock more competitive rates.“She says that mortgage holders value security and with the expectation that we could be facing into a period of upward rate movement “one of the biggest changes we’re seeing is homeowners on fixed rates who are no longer waiting until the term ends. They are engaging now to understand their options and see if a switch makes financial sense.”And does it make sense?Well, she says that for some borrowers, reviewing their mortgage can deliver savings measured in thousands rather than hundreds of euro. As we have said a 0.25 per cent increase will add around €14 per month for every €100,000 borrowed over a 30-year term. “For the average mortgage of just over €360k, that equates to approximately €50 extra in repayments per month or €600 per year. And if rates rise three times, as predicted by some analysts, that’s €1800,” Hennessy says. “Your existing lender should absolutely be part of the conversation, but it shouldn’t be the only conversation.”Conor Pope - 29 minutes agoFresh hikes likely to hurt even more There has been a lot of commentary coming in ahead of the ECB move. According to Martina Hennessy of online brokers doddl.ie, the latest round of rate increases is likely to hurt more than that last round which started in the immediate aftermath of Russia’s invasion of Ukraine in the spring of 2022.“The average mortgage has increased by almost €80,000 in just three years," she said. “That means the same rate increase today hurts more than it would have when rates began to increase in 2022 to curb inflation.”She pointed out that “not all mortgage holders are equally exposed. The 130,000 tracker customers will feel any ECB increase first, followed by variable rate customers, while those coming to the end of low fixed rates could face higher repayments when their current term expires.”Conor Pope - 31 minutes agoWhat does a hike mean in cold hard cash terms?The quarter of a percentage point when it comes will bring financial pain to just over 100,000 tracker mortgage holders in Ireland almost immediately.Every 0.25 per cent increase adds around €14 on to the monthly repayments on a €100,000 outstanding and someone who has €200,000 left to repay can expect to be worse of by close to €30 a month or €300 over the course of a year. But that is only part of the story. If, as is widely expected, the ECB increases its rates on three occasions over the next seven or eight months, than many homeowners will be worse off by the guts of a grand annually. And it is not just tracker holders who have cause for concern. While tracker holders will feel the pain of a hike pretty much immediately, the banks will start increase their variable rates and their fixed rates for new customers. That means people in the market for homes, those coming off fixed rates and borrowers whose mortgages are held by mortgage services providers will also be impacted by the rate increase in the months ahead.Conor Pope - 38 minutes agoECB rate hike has been widely flagged for monthsAt exactly 1:15pm the European Central Bank will announce that its rate rollercoaster has changed direction again after nearly two years of rate cuts which came after two years of rate increases. There was a time when ECB moves were as closely guarded as the Third Secret of Fatima but just as that secret was eventually revealed, so too have the plans of the ECB been exposed well ahead of time. What we know is a rate hike of 0.25 per cent is coming in response to inflation climbing across the EU. The bankers in Frankfurt have a magic number of 2 per cent when it comes to inflation and with the rate across the EU currently standing at 3.2 per cent (it is a little bit higher than that in Ireland) the ECB feels like it has to act. The smart money is on this being one of three rate increases before the end of the year but we will have to wait until later this afternoon to get a sense of the plans from the head of the ECB Christine Lagarde.