Bank of Ireland increase differential on tracker rates

Bank of Ireland increase differential on tracker rates

10:32 AM, 28th February 2013, About 12 years ago 1862

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The story of the Bank of Ireland decision to increase to the differential (interest rate margin) on  tracker mortgages started on this forum when a professional landlord contacted Property118 within minutes of a letter from Bank of Ireland landing on his door mat. What ensued was outrage from landlords and affected residential mortgage borrowers. The story was quickly picked up by the National Media as it wasn’t just the 13,500 affected borrowers who were worried.

Will this set a precedent for other mortgage lenders to follow?

Property118 reacted by using funds donated to The GOOD Landlords Campaign to underwrite the cost of a barristers opinion on the legality of the Bank of Ireland’s actions. The remainder of this thread,one of the most read and most commented threads of all time on Property118, continues to tell the story as it unfolds.

If you want to skip the story and cut to the chase simply CLICK HERE

Of the 13,500 affected borrowers, 1,200 have had the decision reversed by Bank of Ireland. With additional support and pressure we believe all affected borrowers can and will see justice done.

___________________________________________

Lee, a professional Landlord asks, “help! I have just received a letter from the Bank of Ireland stating they want to increase the differential on my tracker rates.

I have 12 mortgages with the Bank of Ireland previously Bristol and West. I have been on a base rate tracker of 1.75% above base, but now Bank of Ireland are using some fine print claiming they have to recapitalise and saying the ‘new differential will be 4.49%.

How can I fight back?”

The original policy wording seems to be:

6 INTEREST

Charging interest at a tracker rate

(j) Unless we change the differential (if any) under condition 6 (n), we will not change the tracker rate unless the base rate changes.

(m) in condition 6 (n):
– a “positive differential” means a percentage which we add to the base rate to arrive at the tracker rate; and a “negative differential” means a percentage which we subtract from the base rate to arrive at the tracker rate.

(n) We may reduce a positive differential or increase a negative differential at our discretion by giving you not less than seven days written notice. This means that we can change the differential in a way that is favourable to you.

The above seems to indicate that they can reduce the rate in my favour, but not give them the right to increase it. Am I correct?


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23:06 PM, 11th August 2015, About 9 years ago

The FOS gave me a copy of 2002 Mortgage conditions - the original mortgage offer on mortgage state you have to refer to 2002 T&C- didnt see them at the time . The case above may have been bound by other conditions they are not the same as mine . BOI changed the differentials for a specific number i would like to know what citeria they used to select us - I varied my mortgage in 2007 to a product they called GC5 it was a fixed rate to SVR - this part of the mortgage was hit and i was forced and changed a year earlier 2012 - then they hit the older part of the mortgage which had stayed on as X17 - this part of the mortgage was on a base rate tracker - which turned out not be a base rate tracker.got changed in 2013. In 2012 i was told by BOI customer service that only the SVR part of the mortgage would go up but then they hit the base rate tracker . Does any one know how many sets of mortgage conditions BOI issued?

on my variation offer they said SVR would not go up more than base bank of E rate plus 2.25 ie 3.25% - but on the front they say may change ...... prudent level of profitability. Nowhere on the variation does it mention differentials going up and the deal was negotiated with John Tucker employee of BOI . I complained and the FOS said i am bound by T&C 2002 . So no point me copying the text . it wont make any difference . The above ruling will be of interest to people who had the faulty T & C - they got the ruling in their due to an error ! if you have the same error that can be brought to fOS attention but i dont see that section in mine ! and David no one read the fine print - Does any one know what Mortgage conditions Simon pugh is actually referring too? and how many mortgage conditions of BOI are out there ???

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23:28 PM, 11th August 2015, About 9 years ago

Reply to the comment left by "Concerned about my BOI mortgage" at "11/08/2015 - 22:53":

FOS has ignored many points on several occasions.

They have ruled against me but I will ask Simon Pugh which T&C he is quoting from - I want the date and when they were issued . I also want to know how many T&C s there are and then check if the bank is allowed to issue varying T&Cs to customers - personally i do not think this is legal or fair .

the fact that people did not receive or read T&Cs has been ruled as a non valid argument - therefore we have to find an argument that does move the FOS

What most people don't realise is that the the Bank of Ireland discussed putting up the differential with the financial services authority - they sanctioned it .
BOI then earmarked all the people they could grab in their net - if 13,000 were affected what terms and conditions were issued to the ones not affected ???? or were all 13,000 bound by 2002 T&C - there seems to be a cut off point in 2004 any mortgages in the first part of the year have one clause after October 2004 its different.

GHH 64

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23:42 PM, 11th August 2015, About 9 years ago

It might be worth contemplating the position of solicitors who may have missed the bank error in wording highlighted in the Simon Pugh case especially if those solicitors also acted on behalf of the bank as well as the purchaser which might well be the case............

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0:22 AM, 12th August 2015, About 9 years ago

Reply to the comment left by "GHH 64" at "11/08/2015 - 23:42":

GHH i think that may be a waste of time . Simon Pugh has highlighted an error on the offer letter in January 2004 - if any one has exactly the same wording mentioning section 6 f - they can have their money back ! I suggest everyone checks their mortgage offer letters

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1:07 AM, 12th August 2015, About 9 years ago

Reply to the comment left by " " at "03/03/2013 - 19:43":

Does this error by BOI help you as you mention section 6 in your offer

FSO have full details available on their website at http://www.ombudsman-decisions.org.uk/. If you enter DRN9601308 into the search box it should be the only result returned.

please spread the word

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1:16 AM, 12th August 2015, About 9 years ago

Reply to the comment left by " " at "04/03/2013 - 12:34":

Does this error by BOI help you as you mention section 6 in your offer

FSO have full details available on their website at http://www.ombudsman-decisions.org.uk/. If you enter DRN9601308 into the search box it should be the only result returned.

please spread the word

David Watson

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8:18 AM, 12th August 2015, About 9 years ago

Here's my last email to FOS. Worth a shot!:

Dear Simon,

The crux of the ‘Simon Pugh FOS decision’ is that the terms and conditions were badly drafted and due to this ambiguity you found in favour of the customer.

Reference your letter of 11 November 2014:

On page 10 above where I signed it says ‘’I/We accept the terms and conditions of this Offer.

On the top right hand corner of every single 1 of the 10 pages it states Offer of Loan. It follows that I was accepting the terms within the Offer of Loan, not other Terms which you refer to (2006) which I have no knowledge of receiving: I certainly haven’t accepted them due to the way the Offer of Loan is drafted.

Subsequently rather than the Terms and Conditions being badly drafted: I haven’t even accepted them!

I look forward to your confirmation that you will find in favour of my complaint.

Tricia Collick

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9:33 AM, 12th August 2015, About 9 years ago

Reply to the comment left by "David Watson" at "12/08/2015 - 08:18":

Well now I am totally confused....!
I had a buy-to-let from Bristol and West. They never sent me a 'terms and conditions booklet'.
I was required to prove my salary before they gave me the mortgage which proves to me that they did not consider me a proffessional landlord (which I am certainly not).
After my first complaint the Bank sent me a copy of the offer letter which was so small it was difficult to read, I guess it came from a microfiche record. In this copy they highlighted that they (B&West) could change the differential under certain circumstance but having never received their Ts & Cs I don't know what they were.
My conveyancing solicitor should have raised this if it was a problem as that was why I paid her and trusted her advice. The firm is no longer in business !

In my view this was a few words designed to put me, the consumer, in a tenuous position and when BofI took over the B&West mortgage business they exploited it.

What more can I say.

Between RyanAir and Bank of Ireland I will never trust an Irish business. That is unfair to other 'straight' Irish businesses but that is how I am left feeling.

Simon tk

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10:29 AM, 12th August 2015, About 9 years ago

The financial ombudsman told me that this ruling was not applicable. None of my points were taken into account when I originally complained.. They took the bank's side. I am certainly not a professional landlord and like Tricia I was asked to provide millions of bits of information . The bank or anyone else did not make me aware of this clause. They are the professionals and should have had a duty to this. I would be grateful if someone can clarify why this ruling is not applicable to us all? I don't get it.

Lucy McKenna

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11:17 AM, 12th August 2015, About 9 years ago

Tricia. I feel for you. You echo my situation. Mortgage and Ryanair And when Ireland was mentioned for an Assurance Vie (it is actually very safe). I said no thank you I am going to Luxembourg

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