Bank of Ireland increase differential on tracker rates
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.
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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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2:59 PM, 16th April 2013, About 13 years ago
I wasn’t offered a cash settlement, but I was contacted twice by phone, and post to encourage me to switch to HSBC. The residential product being offered was at a much higher rate, and the “encouragement” was that BOI would pay the £995 application fee!
We did challenge why they were trying to get rid of us as customer, but were advised that that was not the case.
If I could only get a transcript of their two sales calls!
Member Since February 2014 - Comments: 43
3:16 PM, 16th April 2013, About 13 years ago
so at one point they were prepared to pay out possibly millions to get rid,why if they had a watertight case to up the rate. on the other hand they have now saved themselves a large war chest to fight.
Member Since October 2013 - Comments: 108
3:27 PM, 16th April 2013, About 13 years ago
I joined up for the class action, sent what paperwork I could, including evidence of B&W advert on the web offering fixed rate followed by tracker + 1.75 % for the ‘term’ (the 2.25%.
I was being charged.)
I have been through all B&W paperwork and no mention of ‘differential’.
I had 2 letters dated 5 April :
1 telling me the new payment from 1 May
1 aknowledging the letter they got from the FOS regarding my complaint.
Icidently they (FOS) had put the old rate at 2.9 % when I told them 2.25% !
This is about the BofI breaking a contract…!
Member Since July 2013 - Comments: 89
3:39 PM, 16th April 2013, About 13 years ago
Thats it. Paid The Law Dept £120 to join the Class action & sent all requested ID to them.
Mark, Are you intending a private forum for paid members who have joined the class action? At least the only posts will be off actual members with a genuine reason to post.
Regards Darrell G
(A very annoyed BoI customer)
Member Since July 2013 - Comments: 89
3:52 PM, 16th April 2013, About 13 years ago
Not sure if this is relevant but I got a letter the other day transferring one of my BoI mortgages to their UK subsidiary ‘Bank of Ireland (UK) plc’ Stating It will be regulated by FSA & No changes to my T&C’s.
This happens to be one of my unaffected accounts! Hope their not lining up another dirty trick or exploiting another loop hole?
Member Since January 2011 - Comments: 12196 - Articles: 1396
3:54 PM, 16th April 2013, About 13 years ago
@Darrell G – a private forum is a good idea for paid up members of the Class Action if it’s cheap and easy to set up. Facebook seems like an obvious solution, anybody out there know how to set one up and want to administer it? If anybody can think of a better alternative please speak now or forever old your piece LOL
To be honest I’ve already got too much going on to set up another separate forum, especially a secure one as I don’t know how to go about it.
Member Since July 2013 - Comments: 89
4:33 PM, 16th April 2013, About 13 years ago
@Mark – Now ive signed up to the Class Action, is there any point in me actually going to the FOS myself now?
Member Since July 2013 - Comments: 264
4:37 PM, 16th April 2013, About 13 years ago
Trying to take on the bank on your own in the first place was beyond me. to use snippets of the forum to draft a letter of complaint, when you could have the assistance of a top Barrister for £120 putting yourselfs through alot of stress.
Would you hesitate to instruct a soliciter to evict a tennent?
The odds are 50/50 we win or we lose simple as, probably never get odds like that again in a lifetime.
When we have unaffected Landlords chipping in, its time to give them the respect they truelly deserve & get this class action of to a good start.
Even if the class action gets Residentials overturned would be a bonus.
I have 2 B2Ls affected 12 & 13 years to run, even on current rates its a massive increase. £120 for a Barrister to ease the stress so i can put my feet up & watch Eastenders no contest.
ALLWAYS USE PROFESSIONALS WHERE NEEDED!
Member Since January 2011 - Comments: 12196 - Articles: 1396
5:34 PM, 16th April 2013, About 13 years ago
I really appreciate the supportive comments over the last few days. Thanks to all 🙂
Member Since January 2011 - Comments: 12196 - Articles: 1396
5:35 PM, 16th April 2013, About 13 years ago
@DarrellG – good question, I will defer to Justin to answer that one.