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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Darrell G

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10:16 AM, 21st September 2013, About 11 years ago

Mark, Good to see something starting up on this forum again, sounds promising with Kirsty too. We need to get in touch with all affected borrowers though. Could I suggest Justin use his contacts at the national press to help to alert the other affected borrows in the first instance or use current signed up class action people to raise enough to place national Ads in all the Sunday papers or look towards a PR firm to raise awareness? Where are the '000's of affected borrowers? I'm sure like me, everyone will go ahead with a full class action but everyone really needs to register first so we know what we're dealing with. Once we know say 5000+ will chip in we know where we stand.

Mark Alexander - Founder of Property118

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10:29 AM, 21st September 2013, About 11 years ago

Reply to the comment left by "Kirsty McGregor" at "21/09/2013 - 09:54":

Hi Kirsty

I have emailed Justin's full contact details to you.

Mark Alexander - Founder of Property118

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10:35 AM, 21st September 2013, About 11 years ago

Reply to the comment left by "Darrell G" at "21/09/2013 - 10:16":

Hi Darryl

It's all such a chicken and egg scenario though isn't it?

Where does the money come from to employ the PR company?

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10:36 AM, 21st September 2013, About 11 years ago

Reply to the comment left by "Mark Alexander" at "21/09/2013 - 10:29":

Thanks Mark...we are talking already 🙂

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11:36 AM, 21st September 2013, About 11 years ago

Reply to the comment left by "Mark Alexander" at "21/09/2013 - 10:35":

You don't need to employ a PR company yet. Using a combination of a crowd funding campaign, various members (incl me) who have press contacts that we can leverage & a joined-up torrent on all our social media accounts, it will work

Fed Up Landlord

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11:43 AM, 21st September 2013, About 11 years ago

Having returned to the forum after a bit of time away I was obviously disappointed ( but not totally surprised) to hear that the FCA do not think that BOI have done nothing wrong. After all the replies to the Parliamentary Committee had to be dragged out of them and having apparently condoned BOIs increase beforehand are we really that surprised? I am not a great conspiracy theorist but the old FSA and now the new FCA were and are toothless tigers who are full of people with vested interests.

We are still waiting for the FOS response both collectively and individually and unless Justin is already aware that this is also dead in the water then before we start pressing funding buttons it may be wise to see what that brings. However it does not stop us from exploring funding and media options as we will need a lot of money to take BOI on. Like Mark I cannot understand why only 100 of us have put into the fighting fund when 300 signed up and 13,500 were affected. And that is why we probably need a strategy with a number of "board member specialists" to devise it and drive it once we know that a class action court case is the only option. Finance, PR, Legal, Communications, Administration are some of the specialisms we shall need and these skill areas and the people who know what they are doing are already active on this forum. But it should not all fall on them and they will, if they are kind enough to continue doing what they are doing, will need support. Our support -both financially and time wise. So those of you who have not contributed- just remember every month and year how much this increase is costing you. In my case it's £2000 a year. Is £150 too much to ask for? If we win we will be thousands better off. If we lose- well if enough of us chip in it will be in the hundreds. I am not a betting man but I would take these odds.

Mark Alexander - Founder of Property118

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12:32 PM, 21st September 2013, About 11 years ago

Reply to the comment left by "Gary Nock" at "21/09/2013 - 11:43":

I think a committee approach is a useful suggestion Gary, what do others think?

Peter Bishop

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12:55 PM, 21st September 2013, About 11 years ago

Reply to the comment left by "Mark Alexander" at "21/09/2013 - 12:32":

I would certainly think the committee approach should be explored. In my case the increase amounts to £630 a month!! (yes ladies and gentlemen, that's in excess of £7.5k a year!). I simply cannot afford this and am unable to reach my new repayment levels, as such the bank of Ireland are now increasing pressure - despite the fact they have consistently refused to answer a long and detail request for information from myself. If and when I have the free cash I will subscribe. However, in the meantime I am more than prepared to invest some time and help. Regards, Pete.

Mark Alexander - Founder of Property118

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13:12 PM, 21st September 2013, About 11 years ago

Reply to the comment left by "Peter Bishop" at "21/09/2013 - 12:55":

Hi Peter

If you are not making the additional payments please let Justin know. If they decide to take you to Court a defence which is upheld may well be just as good as winning an attacking strategy. Same goes for anybody else in the same position.

Peter Bishop

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13:16 PM, 21st September 2013, About 11 years ago

Reply to the comment left by "Mark Alexander" at "21/09/2013 - 13:12":

Ok Mark, will do. I am paying more than the required amount under the original terms, but cannot currently meet the new payment in full. Regards, Pete.

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