These changes will affect 13,500 customers, around half of whom have a buy-to-let mortgage.
Many are threatening to take their case to the Financial Ombudsman as they have a tracker mortgage, which is supposed to mirror the Bank of England Bank Rate.
But despite the Bank Rate staying at 0.5pc for four years, the Bank of Ireland has invoked "special conditions" that allows it to increase the margin by which its tracks this rate.
Currently Bank of Ireland has a range of tracker deals, with some customers paying just 1.75pc above the Bank Rate
From May 1 all residential mortgage customers will see the rate they pay rise to 2.49pc above that Bank Rate, with a further increase to 3.99pc above from October 1.
Buy-to-let mortgage customers face even steeper increases. Although many
already pay a slightly higher rate, all buy-to-let tracker deals will pay
the Bank Rate, plus 4.49pc, from May 1.
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These rate increases won't affect customers who have taken out a mortgage via the Post Office, which also has a financial partnership with the Bank of Ireland.
Mortgage brokers said this was an extraordinary move, particularly at a time when interest rates remains so low. These mortgages are designed to give borrowers the peace of mind that their rates will track the Bank Rate, and won't be subject to the lender either failing to pass on rate cuts, or increasing mortgage rates by a higher margin than any underlying movement in interest rates.
A Bank of Ireland spokeswoman said the changes reflected "the significant increase in the cost of funding these mortgages since 2008 and the need for banks to maintain greater levels of capital".
The Bank has provided a special helpline (0800 345 7512) for those concerned about the impact of this rate rise.