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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Simon tk

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15:42 PM, 19th August 2015, About 9 years ago

I have just heard from the obudsman that they will not let me see the actual wording on the decision that won . I have argued that it is just generic and nothing confidential but they insist they cannot give me any information and literally told me politely not to bother them again!!! What am I suppose to do?

Also wanted to ask if I took out the loan that Madoona has just applied for , is there a lot of paperwork required e.g a full blown application with evidence of salary etc or is it just a straight transfer?

Tricia Collick

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17:49 PM, 19th August 2015, About 9 years ago

Reply to the comment left by "Simon tk" at "19/08/2015 - 15:42":

Simon,
I managed finally to speak to someone and applied by phone and had no additional paperwork or cost as I was an existing borrower , I did however borrow money to pay some of the loan off so it ended at 60%LTV and they did ask what I thought value is (although they have one in mind !) and what rent I was getting but no proof needed....
I assume everything will be well, have to wait till paperwork arrives and sign and return before the end Aug.
If everything goes well I shall make a small donation to P118.
Thanks for the pointer Mark !!

Tricia Collick

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17:51 PM, 19th August 2015, About 9 years ago

Simon,
I managed finally to speak to someone and applied by phone and had no additional paperwork or cost as I was an existing borrower , I did however borrow money to pay some of the loan off so it ended at 60%LTV and they did ask what I thought value is (although they have one in mind !) and what rent I was getting but no proof needed....
I assume everything will be well, have to wait till paperwork arrives and sign and return before the end Aug.
If everything goes well I shall make a small donation to P118.
Thanks for the pointer Mark !!

Tricia Collick

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14:23 PM, 21st August 2015, About 9 years ago

I finally got my offer letter today (21stAugust )which was dated 14th August.

Once again they are not consistent with their wording and refer to residential motgage condition 6(a) but did not enclose the mortgage coditions.

The other problem was the dates, offer valid until 13th September but offer must be returned in 14 days (from when it doesn't say.)
I was given their very expensive tel no but then found an o117 979222 on the Martin Lewis 'saynoto0870.com'.
The first, customer services number they had didn't work so I will let them know.

Interestingly I was told that the 'residential' terms referred to the buy to let mortgage because it wasn't a commercial mortgage ! Exactly the arguments we used with them and the FOS to explain we were not 'proffessional' landlords !

She said the residential terms were so big, that is why they didn't send them out and it was unlikely I would want to wade through them all...!! !
I am now getting a copy in the post (I hope). I explained that I wanted the offer but couldn't sign until I had seen these terms.
I was assured this had all been recorded on my file, I have noted name time and date of this conversation.

So they are still up to tricks !! I'll post the clause when (if) they finally arrive !

toona rama

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16:14 PM, 21st August 2015, About 9 years ago

Hi Tricia,

Could you let me know the mortgage product number as when I spoke to their Customer Services person he tried to push me onto a standard fixed rate mortgage, i.e. full status, standard terms mortgage. Thanks.

Mark Alexander - Founder of Property118

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16:26 PM, 21st August 2015, About 9 years ago

Reply to the comment left by "toona rama" at "21/08/2015 - 16:14":

Hi Toona

Here is the link which explains the deal that I mentioned to Tricia >>> http://www.property118.com/bank-of-ireland-deal/76533/
.

Tricia Collick

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16:34 PM, 21st August 2015, About 9 years ago

Hi Toona,
it is 'F84M, fixed for 5 years at 3.29% with no switch fees for existing customers.
I got this through a phone call mid Aug, I am at at least 40 % LTV and they used their own calculations for the value based on the original mortgage value vs my balance.

Good luck Toona, I'm still not out of the woods yet, I won't blindly sign up to this, I need to see their 'clause' which wasn't supplied !

toona rama

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18:39 PM, 21st August 2015, About 9 years ago

Hi Mark,

Thanks for the link which I had read earlier. When I contacted the BOI CS and explained what I wanted the CS guy started asking for income figures and accounts etc. I tried to explain that it was a switch product but it was as if I was applying for a new mortgage.

Hi Tricia, thanks for the product number, I will have another go at trying to get my mortgage switched to this.

Tricia Collick

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9:57 AM, 22nd August 2015, About 9 years ago

Reply to the comment left by "toona rama" at "21/08/2015 - 18:39":

Toona,
they did ask questions such as value and rental income but asked for no proof.
It may have been my low LTV

Tricia Collick

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9:59 AM, 22nd August 2015, About 9 years ago

Toona,
they did ask questions such as value and rental income but asked for no proof.
It may have been my low LTV

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